December 3, 2015 / 6:39 PM / 3 years ago

BUZZ-Mallinckrodt bucks trend as Morgan Stanley upgrades to "overweight"

** Mallinckrodt one of just a few stocks higher in the S&P Healthcare index after Morgan Stanley upgrades drugmaker’s stock to “overweight”

** Broker says its greater confidence in co’s business, based on key franchise Acthar, outweighs drug pricing concerns and controversy surrounding use of specialty pharmacies

** “We believe Acthar can defy the skeptics and continue to grow, helping drive solid total company growth,” analysts write in note

** Cite stock’s significant underperformance YTD, say valuation remains cheap and believe multiple expansion would occur as co meets or beats in 2016

** Raise PT to $88 (from $74), implying 20 pct upside to stock’s current levels

** Mallinckrodt’s woes, along with Valeant’s, exacerbated by Democratic presidential candidate Hillary Clinton’s criticism in late September of “price gouging” in the industry

** MNK has bounced 40 pct off a near 2-year low despite early Nov tweet from short seller Citron Research saying that the drugmaker was “a far worse offender of the reimbursement system”

** Company reported stronger-than-expected earnings on Nov 23

** Shares last up about 1 pct to $73.04 and off about a quarter this year (Reuters Messaging:

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