Piper Jaffray Upgrades Endo Pharmaceuticals (ENDP) to Overweight; Long-Term EPS Growth Increasingly Sustainable

Piper Jaffray & Co. upgrades Endo Pharmaceuticals (Nasdaq: ENDP) from Neutral to Overweight. Price target increased to $29 from $18.

Piper analyst says, "We believe the Lidoderm "cliff" year in 2015/2016 is looking less onerous than we had previously thought. We believe the current P/E of 7x the Street's 2010 EPS estimate is attractive, particularly in the context of an estimated 5-year EPS CAGR of 10%...We expect EPS to grow to $3.39 by 2011 and $4.43 by 2014, up from $2.67 in 2009...We believe more visibility on oral axomadol (a tramadol-like compound that is a new chemical entity) could be a longer-term catalyst for the shares. We will likely see Phase II data in chronic/neuropathic pain in 12-18 months."