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Shares in FTSE 100 prescribed drugs big AstraZeneca (LSE: AZN) have climbed a formidable 22% within the three months to twenty October 2025.
Which means the inventory has outpaced the broader Footsie over that interval. Is it nonetheless one for traders to think about shopping for?
Latest share worth strikes
The share worth restoration started after AstraZeneca reached a cope with the Trump administration in late September, successfully eradicating the specter of steep US import tariffs on foreign-made medicines.
Underneath the settlement, the corporate will develop its US manufacturing footprint with a brand new $4.5bn (£3.4bn) facility in Virginia and implement modest worth changes throughout a few of its Medicaid portfolio.
In return, the corporate has secured exemption from the beforehand proposed 100% tariffs that had loomed over the sector for months and nervous traders.
The transfer varieties a part of the corporate’s wider $50bn (£37bn) US funding plan, which incorporates commitments to analysis, improvement, and manufacturing throughout a number of states.
The deal not solely eliminates a major coverage threat but additionally strengthens its relationship with the US authorities at a time when home manufacturing is politically prized.
Markets seen the result as a significant win for the corporate, with traders clearly shopping for into the story of long-term potential within the profitable US market.
Operational momentum
Whereas the political backdrop has helped, the corporate’s underlying operations additionally stay strong with steering for prime single-digit income progress and low double-digit earnings per share progress for 2025.
Sturdy demand throughout oncology, respiratory, and uncommon ailments continues to underpin efficiency. Latest late-stage trial knowledge has strengthened confidence within the agency’s antibody drug conjugate (ADC) pipeline.
It appears to me that these developments have reassured traders that the enterprise can proceed to ship progress even amid regulatory uncertainty.
Valuation
By comparability, rival GSK has additionally loved a robust quarter, up roughly 21% over the identical interval, however nonetheless trades round 9 occasions ahead earnings with a dividend yield approaching 4%.
On valuation grounds alone, GSK seems extra enticing, significantly for income-focused traders. Nevertheless, AstraZeneca’s deeper pipeline, stronger oncology franchise, and rising US footprint arguably justify the upper a number of.
Potential dangers
Regardless of the progress, some dangers stay. The pricing concessions agreed underneath the US deal may weigh modestly on margins, and additional authorities negotiations may enhance future price stress.
Scientific and manufacturing dangers additionally persist. The corporate’s complicated ADC therapies and biologics rely on continued scientific success and provide chain reliability. Any setback may disrupt earnings momentum and spook traders.
Silly takeaway
The corporate’s current 22% surge displays extra than simply market enthusiasm with the corporate clearing a significant political hurdle and opening up future progress prospects.
For traders looking for regular publicity to world healthcare innovation, I believe AstraZeneca is value contemplating regardless of the dangers.
It does come at a premium to the likes of GSK and with a decrease dividend besides, however I have a look at it as a robust title with a transparent technique that might justify that a number of.
