Sanofi Posts Strong Q3, Buoyed by Dupixent and Flu Vaccine Sales as Stock Looks Undervalued

Sanofi reported strong third-quarter results ahead of our projections, but we don’t expect any major changes to our fair value estimate based on the outperformance, which was partly driven by earlier-than-expected flu vaccine sales. Nevertheless, we continue to view the stock as undervalued with the market not fully appreciating the long-term growth outlook for the firm supported by immunology drug Dupixent and new pipeline drugs that also support the firm’s wide moat. Additionally, we continue to view stock valuation loss earlier in the year surrounding concerns on potential Zantac litigation as excessive.