Viatris Earnings: Facility Inspection Throws Wrench in Business Stability and Sinks Shares

No-moat Viatris reported weak fourth-quarter earnings and ended the year on shaky ground. Total sales of $3.5 billion were down 8.1% and came about $100 million below our estimate. Margins, which had held up well for the first nine months of the year, dipped with gross margin and adjusted EBIT down over 700 basis points and 100 basis points, respectively. After updating our model and trimming our near-term assumptions, we lower our fair value estimate to $13 per share from $14.50.