Sanofi: Decent quarterly report and reassuring guidance for 2016

As Sanofi is entering a two-year transition phase with “no meaningful growth”, it is fairly reassuring that the group is able to deliver in-line core EPS numbers for 2015 on which base it has formed guidance for “broadly stable” figures for 2016. This is obviously not bad at all as Q4 2015 final numbers included very high vaccines sales and a very low tax rate of 19.5%. Although share buybacks are set to make a very significant contribution (EUR1bn bought back in January alone), this should make it possible to deliver core EPS in the region of EUR5.50 once negative currency impacts are factored in i.e. only 1-2% below current consensus estimates but above ours.