Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY

Sanofi
Recommendation Price 12-Mo. Target Price Report Currency
BUY « « « « « USD 43.13 (as of market close Oct 27, 2023) USD 53.00 EUR
Equity Analyst Wan Nurhayati, CFA

GICS Sector Health Care Summary Sanofi is one of the largest pharmaceutical companies with segments Specialty Care,
Sub-Industry Pharmaceuticals Vaccines, General Medicines and Consumer Healthcare.

Key Stock Statistics (Source: CFRA, S&P Global Market Intelligence (SPGMI), Company Reports)
52-Wk Range USD 57.82 - 41.54 Oper.EPS2023E EUR 4.10 Market Capitalization[B] USD 107.9 Beta 0.55
Trailing 12-Month EPS EUR 4.13 Oper.EPS2024E EUR 3.98 Yield [%] 3.19 3-yr Proj. EPS CAGR[%] 3
Trailing 12-Month P/E 9.89 P/E on Oper.EPS2023E 9.96 Dividend Rate/Share USD 1.38 SPGMI's Quality Ranking NR
USD 10K Invested 5 Yrs Ago 11,545.0 Common Shares Outstg.[M] 1,253.00 Trailing 12-Month Dividend USD 1.38 Institutional Ownership [%] 56.0

Price Performance Analyst's Risk Assessment

LOW MEDIUM HIGH

Our risk assessment reflects the balanced profile between
the growth opportunities in new products in high-growth
therapeutic areas and vaccines, albeit with generic threats
to some of its blockbuster drugs.

Revenue/Earnings Data

Revenue (Million EUR)

1Q 2Q 3Q 4Q Year
2024 -- -- -- -- E 46,283
2023 10,863 10,588 12,698 -- E 44,935
2022 10,053 10,742 13,138 11,456 45,389
2021 8,886 9,045 10,829 10,415 39,175
2020 9,316 8,438 9,879 9,736 37,369
2019 8,713 8,980 9,921 10,017 37,631

Earnings Per ADS (EUR)

1Q 2Q 3Q 4Q Year
Source: CFRA, S&P Global Market Intelligence
2024 -- -- -- -- E 3.98
Past performance is not an indication of future performance and should not be relied upon as such.
2023 1.10 0.88 1.28 -- E 4.10
Analysis prepared by Wan Nurhayati, CFA on Oct 30, 2023 07:32 AM, when the stock traded at USD 43.13.
2022 0.92 0.84 1.47 0.87 4.19
2021 0.83 0.69 1.06 0.69 3.30
Highlights Investment Rationale/Risk
2020 0.80 0.67 0.92 0.60 2.87
u Q3 2023 net sales grew 3% at constant u Sanofi’s outlook for a low-single-digit decline in 2019 0.70 0.64 0.98 0.66 2.94
exchange rate (CER, reported: -4% hit by 2024 business EPS due to its plan to increase Fiscal Year ended Dec 31. EPS Estimates based on CFRA's
currency), driven by Dupixent and key new R&D investments has led to a negative share Operating Earnings; historical earnings are adjusted. In periods
launches Altuviiio and Beyfortus (launched at price reaction in October. The 2024 outlook where a different currency has been reported, this has been
the end of March and September, respectively). overshadowed the announcement of the adjusted to match the current quoted currency.
For the full year, we expect a strong uptake of intention to separate its Consumer Healthcare
Dupixent (+35% at CER in 9M) and new business at the earliest in Q4 2024, which we Dividend Data
launches to mitigate the loss of exclusivity (LoE) view as positive. The 2024 outlook is Amount Date Ex-Div. Stk. of Payment
impact for Aubagio and currency headwind. disappointing, with Sanofi only providing further ( USD) Decl. Date Record Date
u Q3 2023 business operating income margin fell details on the R&D plan in December, but we
see the long-term growth beyond 2024 to 1.3751 Feb 15 May 30 May 31 Jun 23 '23
2.3%-pts partly due to higher investments and 0.1767 -- May 26 May 27 Jun 27 '22
launch costs (9M: -0.6%-pts). We forecast continue being driven by the strong uptake of
Dupixent (target of EUR13 billion sales in 2024) 1.2601 Apr 20 May 04 May 05 May 31 '22
lower margins of 28%-29% for 2023 and 2024 1.3677 Mar 23 May 03 May 04 May 26 '21
(2022: 30%) to account for new launches as well as key launches Altuviiio, Beyfortus, and
related costs and higher R&D, with Sanofi Tzield (which we view will also help to reduce Dividends have been paid since 2003 . Source: Company reports
announcing its plan to step up R&D investment Sanofi’s heavy dependency on Dupixent). We Past performance is not an indication of future performance
expect these drivers to cushion the LoE impact and should not be relied as such.
in 2024.
for Aubagio (3% of 9M 2023 sales; already Forecasts are not a reliable indicator of future performance.
u Sanofi kept the mid-single digit business EPS
faced generic competition in Canada and the Dividends paid in currencies other than the Trading currency have
growth at CER guidance for 2023, though with been accordingly converted for display purposes.
U.S., while in Europe, the entry of generic
slightly lower estimated currency headwind of -
competition had just started at the end of
6% to -7% (previously -6.5% to -7.5%). For
September).
2024, however, Sanofi guides for a low single
decline due to its plan to increase R&D u Risks to our opinion and target price include
investments as well as higher effective tax rate failure in late-stage clinical trials and higher-
(due to changes in global tax regulations). We than-expected debt to finance acquisitions.
keep our 2023 earnings per ADS estimates of u Our 12-month target price of USD53 implies
EUR4.10 but cut our 2024 estimate to EUR3.98 12.6x our 2024 earnings per ADS, in line with its
(from EUR4.45) to incorporate a lower margin. historical average.

Redistribution or reproduction is prohibited without written permission. Copyright © 2023 CFRA. This document is not intended to provide personal investment advice and it does not take into account the specific investment
objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek independent financial advice regarding the suitability and/or appropriateness of making an investment
or implementing the investment strategies discussed in this document and should understand that statements regarding future prospects may not be realized. Investors should note that income from such investments, if any,
may fluctuate and that the value of such investments may rise or fall. Accordingly, investors may receive back less than they originally invested. Investors should seek advice concerning any impact this investment may have on
their personal tax position from their own tax advisor. Please note the publication date of this document. It may contain specific information that is no longer current and should not be used to make an investment decision. Unless
otherwise indicated, there is no intention to update this document.
1
Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Business Summary Aug 02, 2023 Corporate information

CORPORATE OVERVIEW: Sanofi has two major segments: (i) Biopharma, which comprises Specialty Care, Investor contact
General Medicines, and Vaccines; and (ii) Consumer Healthcare, a standalone business unit with integrated E. Schaefer-Jansen (33 1 53 77 40 00)
R&D and manufacturing functions.
(i) Specialty Care (38% of 2022 net sales) comprises its medicines in Rare Disease, Neurology Immunology, Office
Oncology, and Rare Blood Disorder (which was set up following the acquisitions of Bioverativ and Ablynx). 46, avenue de la Grande Arm e, Paris, Ile-de-France,
Key products include Aubagio® for Multiple Sclerosis, Dupixent® for atopic dermatitis, Kevzara® for 75017
rheumatoid arthritis, Jevtana® for oncology, as well as Myozyme® and Cerezyme® (under Rare Disease
Telephone
franchise).
33 1 53 77 40 00
(ii) Vaccines (17% of 2022 net sales) offers a broad range of vaccines and is the world leader in the
production and marketing of influenza vaccines. Key products include polio/pertussis/hib vaccines and Fax
influenza vaccines. 33 1 53 77 43 03
(iii) General Medicines (33% of 2022 net sales) offers products like Toujeo® for diabetes, and Praluent® for Website
cardiovascular. www.sanofi.com
(iv) Consumer Healthcare (12% of 2022 net sales) offers products for Digestive Wellness, Pain Care, Allergy,
and Cough and Cold. In July 2023, the company announced the proposed acquisition of Qunol, a market Officers
leading brand in health and wellness in the U.S., which will help to strengthen its portfolio in the wellness CEO & Director Executive VP & Head of
category. P. Hudson Business Operations
STRATEGY: In October 2023, Sanofi provided an update regarding its Play to Win strategy, which includes the M. Roach
following: Independent Chairman
F. Oudea Principal Accounting
(a) Plans to increase its R&D investment to fully realize its pipeline potential and driving long-term growth. Officer and Vice President
(b) Strategic cost initiatives, which include prioritizing its investments in R&D. Sanofi is targeting savings of Executive VP & CFO of Corporate Accounting
a total of up to EUR2 billion from 2024 to end of 2025, of which most will be reallocated to fund innovation J. C. de Chatillon L. Gilhodes
and growth drivers.
Executive VP, General
(c) Intends to separate the Consumer Healthcare business at the earliest in Q4 2024 via the creation of a
Counsel and Head of
publicly listed entity headquartered in France.
Legal, Ethics & Business
(d) Reiterated capital allocation policy where Sanofi expects to maintain a gradually growing dividend, Integrity
consistent with its historical dividend policy. R. Papatheodorou
(e)Preliminary 2024 and 2025 outlook: Sanofi expects 2024 business EPS to decline low-single digits due to
the increased R&D investment and higher effective tax rate (as a result of changes to global tax regulations, Board Members
Sanofi’s effective tax rate is expected to increase to 21% in 2024 from 19% in 2023). In 2025, Sanofi
A. Yver G. Schnepp
expects a “strong rebound” in business EPS growth, driven by continued sales growth, the full benefit from
planned efficiency initiatives, and its expectation of relatively stable R&D expenses year on year. However, B. Lavernos J. Dehecq
Sanofi also removed the 2025 business operating income margin target of 32% given its decision to ramp- C. Babule L. Kingo
up investments as well as pricing headwinds in General Medicines C. Ferrand P. Hudson
Each ADS represents 0.5 of an ordinary share. C. Tran P. Kron
LITIGATION RISK: In August 2022, Sanofi’s share price was impacted by the concerns over Zantac’s D. D. Souza R. Duan
(heartburn drug) litigation risk. Given Zantac’s rights were held by different companies at various times,
potential liability may also be split among these players, in our view. How the potential liability will be split E. Voest S. Weinberg
remains unclear, but looking at period of ownership, we note Sanofi sold Zantac for ~2 years. This is F. Lecorvaisier T. C. Sudhof
something Sanofi highlighted in their statement “Sanofi acquired the OTC rights to Zantac less than three F. Oudea W. Laux
years before these lawsuits commenced, and after the medicine has been on the market for more than 35
years. Sanofi’s sales of Zantac account for a very small percentage of the product’s total sales over the 35+
years that Rx (prescription) and OTC Zantac was available”. We note Zantac was originated by GSK and was Domicile Auditor
launched back in 1983. Sanofi acquired the OTC rights to Zantac in 2017. Before that, there were other France PricewaterhouseCoopers
companies that marketed the prescription and/or OTC Zantac, including Pfizer and Boehringer Ingelheim Audit, Ernst & Young et
(BI). Founded Autres
1973
In mid-December 2022, Sanofi reached an agreement to resolve Goetz’s claims against it (California court
case). According to Sanofi, the settlement is not because it believes these claims have any merit, but rather Employees
to avoid the expense and distraction of a trial in California. With this settlement, Sanofi is not a defendant in 91,573
any of the other California cases set for trial in 2023.
Stockholders
On June 20, 2023, Sanofi announced that the arbitral tribunal dismissed BI’s claim against Sanofi for 10,494
indemnification of potential liabilities related to the ongoing Zantac litigation in the U.S. Note that Sanofi
and BI had sought arbitration to determine the indemnification rights and obligations of Sanofi in the
context of its acquisition of OTC rights for Zantac from BI in 2017. We view the decision as positive as this
could reduce potential liability (BI owned the OTC rights for Zantac from 2016 to January 2017), though this
won’t fully remove the Zantac litigation risk as Sanofi could still face claims for the drug sold during its
ownership period.
FINANCIAL TRENDS: Sales grew at a 5-year CAGR of 4.6% largely driven by Specialty Care and Vaccines,
partly offset by the generic competition including the impact of the loss of exclusivity of Lantus®. Business
operating income grew by 7%-13% at constant currencies in 2019-2022 on the back of efficiency
measures. In terms of leverage profile, the proceeds from the sales of Regeneron shares have helped to
bring net debt down to EUR8.8 billion as at end-2020 from EUR15.1 billion in 2019 (net debt was higher in
2018-2019 following a number of acquisitions made). Sanofi closed 2022 with a net debt of EUR6.4 billion.
Dividend per share of EUR3.56 for 2022 marked the 29th consecutive annual increase in dividend.

Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 2
Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Quantitative Evaluations Expanded Ratio Analysis

Fair Value Rank NR 1 2 3 4 5 2022 2021 2020 2019

Lowest Highest Price/Sales 2.51 2.83 2.68 2.99
Based on CFRA's proprietary quantitative model, Price/EBITDA 8.10 9.85 9.56 11.12
stocks are ranked from most overvalued (1) to most Price/Pretax Income 10.86 14.14 7.08 37.40
undervalued (5). P/E Ratio 10.81 13.36 13.85 15.23
Avg. Diluted Shares Outstg. (M) 1,256.90 1,257.90 1,260.10 1,257.10
Fair Value N/A
Calculation Figures based on fiscal year-end price

Volatility LOW AVERAGE HIGH

Technical BULLISH Since August, 2023, the technical indicators for SNY Key Growth Rates and Averages
Evaluation have been BULLISH"
Past Growth Rate (%) 1 Year 3 Years 5 Years
Insider Activity NA UNFAVORABLE NEUTRAL FAVORABLE Net Income 34.52 44.86 NM
Sales 15.86 6.45 4.62

Ratio Analysis (Annual Avg.)

Net Margin (%) 18.44 22.41 17.32
% LT Debt to Capitalization 15.42 18.95 21.35
Return on Equity (%) 11.77 13.80 10.76

Company Financials Fiscal year ending Dec 31

Per ADS Data (EUR) 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013
Tangible Book Value 7.57 5.55 5.19 0.29 -2.01 4.95 6.09 6.16 2.92 4.82
Free Cash Flow 6.65 6.77 4.26 4.74 2.86 4.31 4.47 4.71 4.74 4.27
Earnings 6.66 4.95 9.76 2.27 3.44 2.98 3.39 3.34 3.21 2.71
Earnings (Normalized) 4.19 3.30 2.87 2.94 2.72 2.83 2.88 2.94 2.45 2.48
Dividends 3.56 3.33 3.20 3.15 3.07 3.03 2.96 2.93 2.85 2.80
Payout Ratio (%) 49.79 64.41 32.02 139.00 87.62 44.08 79.83 86.17 83.74 97.90
Prices: High 53.37 44.75 48.11 45.55 36.89 42.33 39.42 50.07 44.78 43.51
Prices: Low 38.26 37.40 35.03 35.75 31.57 36.65 33.72 37.30 35.62 33.23
P/E Ratio: High 13.00 14.50 15.70 15.40 14.70 14.90 14.60 17.20 19.30 16.40
P/E Ratio: Low 8.20 12.00 10.70 12.10 12.00 11.60 12.10 12.90 14.90 13.00

Income Statement Analysis (Million EUR)

Revenue 45,389 39,175 37,369 37,631 35,677 36,221 34,696 34,861 31,999 31,291
Operating Income 11,038 8,565 7,579 6,802 6,024 7,273 7,518 6,971 6,752 6,110
Depreciation + Amortization 3,365 3,001 3,186 3,593 3,339 3,007 2,841 3,263 3,117 3,508
Interest Expense 394.00 362.00 459.00 544.00 471.00 346.00 360.00 416.00 357.00 365.00
Pretax Income 10,490 7,837 14,137 3,007 4,904 5,616 5,811 5,221 5,606 4,523
Effective Tax Rate 19.10 19.90 12.80 4.00 9.80 30.70 22.80 13.60 21.70 16.10
Net Income 8,371 6,223 12,294 2,754 4,306 8,416 4,709 4,287 4,390 3,716
Net Income (Normalized) 6,711 5,142 4,748 4,245 3,811 4,365 4,423 4,014 3,734 3,400

Balance Sheet and Other Financial Data (Million EUR)

Cash 12,736 10,109 13,915 9,431 6,955 10,315 10,276 9,187 7,448 8,340
Current Assets 34,111 30,653 33,786 28,936 24,647 26,388 33,112 30,680 23,437 23,926
Total Assets 126,722 120,242 114,413 112,630 111,408 99,813 104,679 102,321 97,392 96,055
Current Liabilities 23,974 21,295 19,280 20,387 17,376 15,463 17,638 17,808 13,032 13,929
Long Term Debt 14,857 17,123 19,745 20,131 21,989 14,306 16,781 13,069 13,229 10,364
Total Capital 96,364 91,446 86,927 85,165 83,675 73,840 76,303 74,768 71,084 71,623
Capital Expenditures 1,606 1,479 1,254 1,323 1,415 1,388 1,219 1,203 1,453 1,306
Cash from Operations 10,526 10,522 7,418 7,715 5,547 7,379 7,838 8,920 7,690 6,954
Current Ratio 1.42 1.44 1.75 1.42 1.42 1.71 1.88 1.72 1.80 1.72
% Long Term Debt of Capitalization 15.40 18.70 22.70 23.60 26.30 19.40 22.00 17.50 18.60 14.50
% Net Income of Revenue 18.40 15.90 32.90 7.30 12.10 23.20 13.60 12.30 13.70 11.90
% Return on Assets 5.59 4.56 4.17 3.80 3.56 4.45 4.54 4.36 4.36 3.89
% Return on Equity 11.80 9.50 20.10 4.90 7.50 6.70 7.70 7.90 7.80 6.60

Source: S&P Global Market Intelligence. Data may be preliminary or restated; before results of discontinued operations/special items. Per share data adjusted for stock dividends; EPS diluted.
E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked. UR-Under Review.

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Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Sub-Industry Outlook Industry Performance

Our outlook for the pharmaceutical sub-industry is
neutral. We expect an improved outlook for the
rest of 2023, partly predicated on a return to
normalcy, with improved utilization and electives
demand. Contributions from new launches with a
focus on Alzheimer’s disease, obesity, and
oncology will remain key growth drivers as a
number of pharmaceutical firms see loss of
exclusivities and face increasing competition. We
also expect tough comparisons Y/Y due to lower
demand for Covid-19 vaccines and treatments.
Going forward, we expect Covid-related activity to
shift to a seasonal phenomenon, like the flu. While
there may be further surges in Covid-related sales,
we expect a more annuity-like pattern to such
sales.
One concern is the possibility of a recession, which
could weigh on electives demand. Yet, key
therapeutic areas seen as essential, such as
oncology and immunology, are likely to see
ongoing demand, in our view, and could be
relatively less susceptible to slowdowns.
CFRA thinks health care policy risks are on the
rise. Reducing drug prices continues to be a
bipartisan issue as both parties aim for more
affordable drug prices for Americans. The Inflation
Reduction Act (IRA) allows Medicare to directly
negotiate prices on the top 10 branded drugs for
Medicare Part D coverage, with revised pricing
taking effect in January 2026, and later expanding
to 20 branded drugs in 2028. The Centers for
Medicare & Medicaid Services published the list of
the first 10 top-selling prescription drugs selected
for negotiations on August 29, 2023, which
includes drugs from large U.S. Pharmaceutical
companies (BMY, PFE, LLY, MRK, JNJ). The
negotiated maximum fair prices for these drugs
will be published by September 1, 2024. We think
the IRA may also have implications for companies.
For example, if pharmaceutical firms know that
new blockbusters may get negotiated down, they
may price them higher at launch. The act may also
have implications as to where firms decide to
invest.
We also note that the FTC appears to be taking a
more active stance on antitrust review, but has GICS Sector:Health Care
not moved so far to block them. We think there Sub-Industry:Pharmaceuticals
may be increased scrutiny for potential Based on S&P 1500 Indexes
pharmaceutical M&A, especially following the Five-Year market price performance through Oct 28, 2023
FTC’s lawsuit against Amgen’s acquisition of
Horizon, which was later settled, and
successfully closed.
Global minimum taxation of at least 15% on
multinationals with more than $890 million in
annual revenue proposed by the U.S. and
backed by 137 countries is scheduled to take
effect at the beginning of 2024. We foresee
that this would potentially hurt the bottom-line
profitability of large multinational
pharmaceuticals.
We expect major generic makers to continue to
struggle due to lower-cost emerging market
competition. We think India-based generic
makers will continue to take market share from
developed nation firms due to lower production
costs. We also expect Chinese pharmaceuticals
to shift some of their resources away from
generics and focus on more lucrative
innovative drugs, which could increase
competitive pressures. We also see a rise in
biosimilars, which, while more expensive to
produce than generics, will likely get a longer
period of time before the field gets crowded
with other biosimilars in the same category.
YTD through October 13, the S&P Composite
1500 Pharmaceuticals Index was down 0.8%
vs. an 11.6% increase for the S&P Composite NOTE: A sector chart appears when the sub-industry does not have
1500 Index. In 2022, the S&P Pharmaceuticals sufficient historical index data.
Index returned a gain of 5.5% vs. a 19.1% drop All Sector & Sub-Industry information is based on the Global Industry
for the S&P Composite 1500. Classification Standard (GICS).
Past performance is not an indication of future performance and should
/ Sel Hardy not be relied upon as such.
Source: CFRA, S&P Global Market Intelligence

Sub-Industry: Pharmaceuticals Peer Group*: Pharmaceuticals

Recent 30-Day 1-Year Fair Return
Stock Stock Stk. Mkt. Price Price P/E Value Yield on Equity LTD to
Peer Group Symbol Exchange Currency Price Cap. (M) Chg. (%) Chg. (%) Ratio Calc. (%) (%) Cap (%)

Sanofi SNY NasdaqGS USD 43.13 108,138.0 -18.6 3.7 10.0 N/A 3.2 N/A N/A
AstraZeneca PLC AZN NasdaqGS USD 61.89 190,453.0 -8.9 7.4 17.0 N/A 2.3 16.8 35.8
Bristol-Myers Squibb Company BMY NYSE USD 51.02 103,813.0 -11.9 -31.6 7.0 N/A 4.5 26.9 47.1
GSK plc GSK NYSE USD 34.56 70,391.0 -6.7 5.6 11.0 N/A 3.9 33.2 46.2
Jazz Pharmaceuticals plc JAZZ NasdaqGS USD 126.07 7,959.0 -3.9 -10.8 NM N/A N/A -2.6 61.0
Novartis AG NVS NYSE USD 92.27 190,843.0 -8.0 16.0 14.0 N/A 2.5 16.5 28.5
Pfizer Inc. PFE NYSE USD 30.11 170,000.0 -6.2 -34.2 6.0 15.58 5.4 23.1 37.4
Royalty Pharma plc RPRX NasdaqGS USD 26.21 11,766.0 -1.8 -37.6 46.0 N/A 3.1 4.7 36.2
Teva Pharmaceutical Industries Limited TEVA NYSE USD 8.12 9,100.0 -18.9 -6.6 4.0 N/A N/A -26.6 65.1
Viatris Inc. VTRS NasdaqGS USD 8.77 10,520.0 -8.6 -11.1 3.0 4.50 5.5 9.1 43.5
Zoetis Inc. ZTS NYSE USD 156.03 71,823.0 -10.7 3.2 31.0 121.26 1.0 48.0 57.8

*For Peer Groups with more than 10 companies or stocks, selection of issues is based on market capitalization.
NA-Not Available; NM-Not Meaningful.
Note: Peers are selected based on Global Industry Classification Standards and market capitalization. The peer group list includes companies with similar characteristics, but may not include all the companies within the same
industry and/or that engage in the same line of business.

Redistribution or reproduction is prohibited without prior written permission. Copyright © 2023 CFRA. 4
Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Analyst Research Notes and other Company News

October 27, 2023 growth in business EPS in 2022 (+17% at constant exchange rate, CER), largely in
08:28 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 53.33****): line with S&P Capital IQ consensus estimates. The growth was again driven by
We adjust our target price by USD7 to USD53, implying 12.6x our 2024 earnings per Dupixent, along with the recovery of travel and booster vaccines. For 2023, however,
ADS, in line with its historical average. Sanofi’s outlook for a low single digit decline SAN guides for a slower business EPS growth of low single digit at CER (estimated
in 2024 business EPS, due to its plan to increase R&D investments as well as higher currency impact of -3.5% to -4.5%) with the continued growth in Dupixent being
effective tax rate, has led to a negative share price reaction. Sanofi expects a partially offset by the generic competition impact for Aubagio (5% of 2022 sales).
“strong rebound” in 2025 business EPS as it benefits from planned efficiency We see the strong uptake of Dupixent (expansion of indication, aims to achieve
initiatives and the expectation of stable R&D expenses. The 2024 outlook sales of EUR10 billion in 2023), new launches, and efficiency initiatives to drive
overshadowed the announcement of the intention to separate its Consumer growth ahead which will provide some cushion to the generic impact and higher
Healthcare business at the earliest in Q4 2024, which we view as positive. We keep costs related to new launches. Our 2023 earnings per ADS estimate of EUR4.13
our 2023 earnings per ADS estimates of EUR4.10 (Sanofi kept its 2023 outlook) but remain unchanged, and we start our 2024 estimate of EUR4.45. / Wan Nurhayati,
cut our 2024 estimate to EUR3.98 (EUR4.45) to incorporate lower margin. The 2024 CFA
outlook is disappointing, but we see the long-term growth beyond 2024 to continue
being driven by the strong uptake of Dupixent as well as key new launches Altuviiio December 08, 2022
and Beyfortus. / Wan Nurhayati, CFA 05:34 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 47.94****):
We keep our Buy opinion with the same target price of US$54, implying 12.5x our
July 31, 2023 2023 earnings per ADS, in line with its historical mean. We view the recent court
03:55 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 52.48****): ruling in the Zantac federal Multi-District Litigation (MDL) in the U.S. as positive as
We keep our Buy opinion with the same target of USD60, implying 13x our 2023 the ruling could remove some portion of potential liability related to the Zantac
earnings per ADS, in line its historical average. Q2 business EPS grew 8.1% Y/Y at litigation. Judge Rosenberg granted all of the defendants’ Daubert motions on
constant exchange rates (CER, reported: +0.6% due to currency headwind) on better general causation (motions to exclude expert witnesses) and the court has
net sales (driven by Specialty Care and Vaccine) and operating income margin dismissed all MDL cases alleging the five cancers in the MDL (liver, bladder,
(better mix and efficiency, further lifted by higher capital gains related to portfolio pancreatic, esophageal, and stomach). That said, the plaintiffs could appeal, and the
streamlining). SNY raised its 2023 guidance to mid-single-digit business EPS company is still facing personal injury cases filed in state courts. Our earnings per
growth at CER (previously low-single-digit) though with a larger estimated currency ADS estimates of EUR4.05 for 2022 and EUR4.13 for 2023 remain unchanged. We
headwind of -6.5% to -7.5% (previously -5.5% to -6.5%). We adjust our 2023 continue to expect the strong uptake of Dupixent and efficiency initiatives to drive
earnings per ADS estimates slightly to EUR4.10 (EUR4.13) to account for the latest SNY’s growth going forward. / Wan Nurhayati, CFA
results and keep our 2024 estimate. Overall, we continue see the strong uptake of
Dupixent (expansion of indication), new launches (key launches include Altuviiio, October 31, 2022
Beyfortus, and Tzield), and efficiency initiatives to drive growth ahead, which will 01:25 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 43.05****):
help to cushion the generic impact for Aubagio. / Wan Nurhayati, CFA We keep our Buy opinion and adjust our target price by $5 to $54, implying 13.5x our
2023 earnings per ADS, in line its historical mean. The continued strong growth of
June 21, 2023 Dupixent, strong flu vaccines, and the rebound of travel vaccines as well as
06:22 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 53.10****): efficiency gains helped to lift business EPS by 18% at constant exchange rate (CER)
We keep our Buy opinion with the same target price of US$60, implying 13x our in Q3 2022 (reported: +32% on currency tailwind). Given the result, SAN revised its
2023 earnings per ADS, in line with its historical mean. On June 20, 2023, Sanofi 2022 business EPS growth guidance again to ~16% at CER with larger estimated
announced that the arbitral tribunal dismissed Boehringer Ingelheim’s (BI) claim positive currency impact of 9.5% to 10.5% (previously ~15% growth at CER with
against Sanofi for indemnification of potential liabilities related to the ongoing positive currency impact of 7.5%-8.5%). We forecast sales growth of 4%-9% for
Zantac litigation in the U.S. Note that Sanofi and BI had sought arbitration to 2022 and 2023 and business operating income margin to improve to 30%-31%
determine the indemnification rights and obligations of Sanofi in the context of its (2021: 28.4%), supported by the continued strong uptake of Dupixent and the
acquisition of OTC rights for Zantac from BI in 2017. We view the decision as positive ongoing operation efficiencies. We adjust our earnings per ADS estimates to
as this could reduce potential liability (BI owned the OTC rights for Zantac from 2016 EUR4.05 from EUR3.85 for 2022 and to EUR4.13 from EUR3.98 for 2023 to account
to January 2017), though this won’t fully remove the Zantac litigation risk as Sanofi for the latest result and guidance upgrade. / Wan Nurhayati, CFA
could still face claims for the drug sold during its ownership period. In terms of
earnings, we continue to expect the strong uptake of Dupixent, new launches, and
efficiency initiatives to drive growth ahead. Our estimates remain unchanged. / Wan
Nurhayati, CFA

April 28, 2023

03:14 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 56.09****):
We adjust our target price by $6 to $60, implying 13x our 2023 earnings per ADS, in
line its historical mean. Q1 2023 business EPS grew 11.3% Y/Y (+11.9% at constant
exchange rates, CER) on higher net sales and other revenues (driven by its star
performer, Dupixent, along with the strong recovery of booster and travel vaccine as
well as favorable phasing effect in Consumer Healthcare) and improved margin
(better product mix offset by higher SG&A costs). Nevertheless, Sanofi kept its 2023
guidance of low single digit business EPS growth at CER with the continued growth
in Dupixent being offset by the loss of exclusivity (LoE) impact for Aubagio (expects
to see full LoE impact from Q2 2023). We see the strong uptake of Dupixent
(expansion of indication - two additional approvals in Q1), new launches, and
efficiency initiatives to drive growth ahead, which will provide some cushion to the
generic impact and higher costs related to new launches. Our estimates remain
unchanged. Maintain Buy. / Wan Nurhayati, CFA

February 06, 2023

01:35 AM ET... CFRA Keeps Buy Opinion on ADSs of Sanofi (SNY 46.02****):
We keep our Buy opinion with the same target price of US$54, implying 12x our
2023 earnings per ADS, in line with its historical mean. SAN delivered a 26% Y/Y

Note: Research notes reflect CFRA's published opinions and analysis on the stock at the time the note was published. The note reflects the views of the equity analyst as of
the date and time indicated in the note, and may not reflect CFRA's current view on the company.
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Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Analysts Recommendations Wall Street Consensus Opinion

Buy

Wall Street Consensus vs. Performance

For fiscal year 2023, analysts estimate that SNY will earn
EUR 5.56. For fiscal year 2024, analysts estimate that
SNY's earnings per share will grow by 6.85% to EUR 5.95.

No. of
Recommendations % of Total 1 Mo.Prior 3 Mos.Prior
Buy 5 63 5 4
Buy/Hold 2 25 2 2
Hold 1 13 1 1
Weak hold 0 0 0 0
Sell 0 0 0 0
No Opinion 0 0 0 0
Total 8 100 8 7

Wall Street Consensus Estimates

Fiscal Year Avg Est. High Est. Low Est. # of Est. Est. P/E
2024 5.95 9.36 4.62 4 7.25
2023 5.56 8.82 4.29 4 7.75
2024 vs. 2023 p 7% p 6% p 8% N/A% q -6%

Q4'23 0.85 0.85 0.85 1 50.56

Forecasts are not reliable indicator of future performance.

Note: A company's earnings outlook plays a major part in any investment decision. S&P Global Market Intelligence organizes the earnings estimates of over 2,300 Wall Street analysts, and
provides their consensus of earnings over the next two years, as well as how those earnings estimates have changed over time. Note that the information provided in relation to consensus
estimates is not intended to predict actual results and should not be taken as a reliable indicator of future performance.
Note: For all tables, graphs and charts in this report that do not cite any reference or source, the source is S&P Global Market Intelligence.

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Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Glossary

STARS Abbreviations Used in Equity Research Reports

Since January 1, 1987, CFRA Equity and Fund Research Services, and its CAGR - Compound Annual Growth Rate
predecessor S&P Capital IQ Equity Research has ranked a universe of U.S. CAPEX - Capital Expenditures
common stocks, ADRs (American Depositary Receipts), and ADSs (American CY - Calendar Year
Depositary Shares) based on a given equity's potential for future performance. DCF - Discounted Cash Flow
Similarly, we have ranked Asian and European equities since June 30, 2002. DDM - Dividend Discount Model
Under proprietary STARS (Stock Appreciation Ranking System), equity analysts EBIT - Earnings Before Interest and Taxes
rank equities according to their individual forecast of an equity's future total EBITDA - Earnings Before Interest, Taxes, Depreciation & Amortization
return potential versus the expected total return of a relevant benchmark (e.g., EPS - Earnings Per Share
a regional index (MSCI AC Asia Pacific Index, MSCI AC Europe Index or S&P 500® EV - Enterprise Value
Index)), based on a 12-month time horizon. STARS was designed to help FCF - Free Cash Flow
investors looking to put their investment decisions in perspective. Data used to FFO - Funds From Operations
assist in determining the STARS ranking may be the result of the analyst's own FY - Fiscal Year
models as well as internal proprietary models resulting from dynamic data P/E - Price/Earnings
inputs. P/NAV - Price to Net Asset Value
PEG Ratio - P/E-to-Growth Ratio
S&P Global Market Intelligence's Quality Ranking PV - Present Value
(also known as S&P Capital IQ Earnings & Dividend Rankings) - Growth and R&D - Research & Development
S&P Capital IQ Earnings & Dividend Rankings stability of earnings and dividends ROCE - Return on Capital Employed
are deemed key elements in establishing S&P Global Market Intelligence's ROE Return on Equity
earnings and dividend rankings for common stocks, which are designed to ROI - Return on Investment
capsulize the nature of this record in a single symbol. It should be noted, ROIC - Return on Invested Capital
however, that the process also takes into consideration certain adjustments ROA - Return on Assets
and modifications deemed desirable in establishing such rankings. The final SG&A - Selling, General & Administrative Expenses
score for each stock is measured against a scoring matrix determined by SOTP - Sum-of-The-Parts
analysis of the scores of a large and representative sample of stocks. The range WACC - Weighted Average Cost of Capital
of scores in the array of this sample has been aligned with the following ladder
of rankings: Dividends on American Depository Receipts (ADRs) and American Depository
Shares (ADSs) are net of taxes (paid in the country of origin).
A+ Highest B Below Average
Qualitative Risk Assessment
A High B- Lower
A Above C Lowest
Reflects an equity analyst's view of a given company's operational risk, or the
risk of a firm's ability to continue as an ongoing concern. The Qualitative Risk
B+ Average D In Reorganization
Assessment is a relative ranking to the U.S. STARS universe, and should be
NC Not Ranked reflective of risk factors related to a company's operations, as opposed to risk
and volatility measures associated with share prices. For an ETF this reflects on
EPS Estimates a capitalization-weighted basis, the average qualitative risk assessment
CFRA's earnings per share (EPS) estimates reflect analyst projections of future assigned to holdings of the fund.
EPS from continuing operations, and generally exclude various items that are
viewed as special, non-recurring, or extraordinary. Also, EPS estimates reflect STARS Ranking system and definition:
either forecasts of equity analysts; or, the consensus (average) EPS estimate, ««««« 5-STARS (Strong Buy):
which are independently compiled by S&P Global Market Intelligence, a data Total return is expected to outperform the total return of a relevant benchmark,
provider to CFRA. Among the items typically excluded from EPS estimates are by a notable margin over the coming 12 months, with shares rising in price on
asset sale gains; impairment, restructuring or merger-related charges; legal an absolute basis.
and insurance settlements; in process research and development expenses; ««««« 4-STARS (Buy):
gains or losses on the extinguishment of debt; the cumulative effect of Total return is expected to outperform the total return of a relevant benchmark
accounting changes; and earnings related to operations that have been over the coming 12 months.
classified by the company as discontinued. The inclusion of some items, such
as stock option expense and recurring types of other charges, may vary, and ««««« 3-STARS (Hold):
depend on such factors as industry practice, analyst judgment, and the extent Total return is expected to closely approximate the total return of a relevant
to which some types of data is disclosed by companies. benchmark over the coming 12 months.
««««« 2-STARS (Sell):
12-Month Target Price Total return is expected to underperform the total return of a relevant
The equity analyst's projection of the market price a given security will benchmark over the coming 12 months.
command 12 months hence, based on a combination of intrinsic, relative, and
««««« 1-STAR (Strong Sell):
private market valuation metrics, including Fair Value.
Total return is expected to underperform the total return of a relevant
benchmark by a notable margin over the coming 12 months, with shares falling
in price on an absolute basis.
Relevant benchmarks:
In North America, the relevant benchmark is the S&P 500 Index, in Europe and
in Asia, the relevant benchmarks are the MSCI AC Europe Index and the MSCI AC
Asia Pacific Index, respectively.

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Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
Sanofi
Disclosures

Stocks are ranked in accordance with the following ranking methodologies:
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containing STARS rankings refer to the Glossary section of the report for detailed
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Momentum. In the U.S., a sixth sub-category for Financial Health will also be displayed.
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STARS Stock Reports:
Global STARS Distribution as of September 30, 2023
Ranking North America Europe Asia Global
Buy 36.8% 34.5% 41.6% 37.4%
Hold 53.8% 51.2% 50.3% 52.6%
Sell 9.4% 14.3% 8.1% 10.1%
Total 100.0% 100.0% 100.0% 100.0%
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STARS Stock Reports are prepared by the equity research analysts of CFRA and its
affiliates and subsidiaries. Quantitative Stock Reports are prepared by CFRA. All of the
views expressed in STARS Stock Reports accurately reflect the research analyst's
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expressed in the Quantitative Stock Reports accurately reflect the output of CFRA's
algorithms and programs. Analysts generally update STARS Stock Reports at least four
times each year. Quantitative Stock Reports are generally updated weekly. No part of
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specific rankings or views expressed in any Stock Report.
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Stock Report | October 30, 2023 | NasdaqGS Symbol: SNY
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