Allergan (NYSE: AGN) is a specialty pharmaceutical company operating in the research, development and manufacture of pharmaceutical products. The company offers a portfolio of products that provide treatment for the central nervous system, gastroenterology, women's health and urology, ophthalmology, neurosciences, medical aesthetics, dermatology, plastic surgery, liver disease, inflammation, metabolic syndromes, and fibrosis, as well as Alzheimer's disease. In addition, the company distributes generic and branded pharmaceutical products primarily to independent and chain pharmacies, nursing homes, mail order pharmacies, hospitals, clinics and physician offices.

What we like about it?

Despite the market’s excessive focus on product-specific headwinds, we estimate Allergan as a whole has one of the industry’s most durable drug portfolios when it comes to exclusivity and patent protection. The company also boasts an industry-leading research and development (R&D) pipeline that, in conjunction with its base businesses, should continue to drive strong earnings and free cash flow growth over our investment horizon.

As a value investment style manager, it is rare to find highly cash generative, innovative businesses with enormous growth potential trading in deep value territory, but we see a specialty pharmaceutical firm such as Allergan offering just such potential opportunities.


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