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What does the report translate to considering fair value in the...

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bgtaylo

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14/03/20

12:21

Post #: 43491800
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Originally posted by 311cpm963: ↑

I have a Morningstar Deep Dive report on the Corona Virus but it is 39 pages long and I think I will get lynched if I cut and paste so I will paste the headline for anyone who can access this at MorningStar. Its a good read and has some really interesting information so I will also paste the Key Takeaways for anyone interested.

"Coronavirus: Widespread Disease, but Drug Pipeline ProgressMinimal long-term economic impact; forecast low fatality rateimplies overstated threat to the economy"

Key Takeaways
× Overall, we see a weighted average hit of 1.5% to 2020 global GDP and 0.2% to long-run global GDP. We forecast a muted long-term impact because damage to productive capacity will be small, plus economic confidence should quickly return once the virus subsides.
× Our long-term China GDP forecast is unchanged. We have lowered our 2020 China GDP forecast by 250 basis points, but we expect catch-up growth in following years.
× We assume a global fatality rate in our base case of 0.5% among those infected, higher than seasonal flu and recent pandemics like the 2009 swine flu, but much lower than levels reported to date (as diagnosis improves). We expect even lower fatality rates for developed countries (more ICU beds per capita, best practices) and the working age population (the disease is most severe in the elderly).
× We see reason for optimism surrounding vaccines and treatments. We should see initial data from Gilead's remdesivir by April; this could be a strong defense for patients with severe disease, and we raised our Gilead fair value estimate slightly to $85 per share. Among vaccines, Moderna is most advanced, but we don't expect use until 2021. See page 18 for a summary of the COVID-19 pipeline.

Morningstar Scenario Analysis: COVID-19 Health and Economic Hit
Fatalities - Avg 0.10%
World GDP impact for 2020 - 1.5% and Long Run 0.2%

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What does the report translate to considering fair value in the ASX market inGeneral?
All ords/ 200 etc

APT Price at posting: $23.24 Sentiment: Buy Disclosure: Held
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0 Great analysis

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