CTLT Anticipates Boost From Demand for Injectable Weight-Loss

Main Highlights
1. Syringe maker Catalent suggested soaring demand for injectable weight-loss drugs could lead to sizable revenue gains, and shares surged.

2. The company said sales of its pre-filled syringes could increase more than five-fold because of the popularity of those drugs.

3. Catalent also released preliminary quarterly results, and revenue exceeded forecasts.

Syringe maker Catalent (NYSE: CTLT) said soaring demand for injectable weight-loss drugs could lead to big revenue gains, and shares surged over 11%.

The company indicated that it expected a majority of its current and upcoming production capacity for pre-filled syringes until fiscal year 2026 to soon be booked out.

Catalent syringes are used to deliver Novo Nordisk’s (NVO) Wegovy, a diabetes treatment that has been shown to help patients lose weight. Wegovy is in the class of drugs known as GLP-1, which also includes Novo Nordisk’s Ozempic and Eli Lilly’s (LLY) Mounjaro and Zepbound.

Catalent also reported preliminary first quarter fiscal 2024 revenue of $982 million, down 4% from a year ago but more than analysts’ estimates. The company announced on Monday it was delaying release of its quarterly statement because of a $700 million goodwill impairment charge

Technical Analysis
(NYSE: CTLT) is trading near the bottom of its 52-week range and below its 200-day simple moving average.

What does this mean?
Investors have been pushing the share price lower, and the stock still appears to have downward momentum.