5 Jul

The AstraZeneca share price is climbing. Is growth really here again?

first_img Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Enter Your Email Address Image source: Getty Images. Alan Oscroft | Friday, 21st May, 2021 | More on: AZN Our 6 ‘Best Buys Now’ Shares One FTSE “Snowball Stock” With Runaway Revenues The AstraZeneca share price is climbing. Is growth really here again? I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.center_img Grab your free report – while it’s online. Looking for new share ideas?Grab this FREE report now.Inside, you discover one FTSE company with a runaway snowball of profits.From 2015-2019…Revenues increased 38.6%.Its net income went up 19.7 times!Since 2012, revenues from regular users have almost DOUBLEDThe opportunity here really is astounding.In fact, one of its own board members recently snapped up 25,000 shares using their own money… So why sit on the side lines a minute longer?You could have the full details on this company right now. After Pascal Soriot took the helm during crisis time at AstraZeneca (LSE: AZN), it was always going to take a while to turn things round. Maybe about five years, I thought, back in 2012. Still, the pharmaceuticals giant recorded a hefty 2020 profit rise after several years of falls. And the AstraZeneca share price had already been gaining in anticipation of a return to long-term growth.Since early 2019, the shares have been climbing. And over a five-year period, they’ve more than doubled in price. The last 12 months have been a bit rocky, with the company getting into troubles with the European Union over shipments of Covid-19 vaccine.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…But, since early March, we’re looking at a steady rise again. A first-quarter earnings call at the end of April gave AstraZeneca shares another boost, and they’ve continued upwards since. My Motley Fool colleague Pam Narang has picked up on some of the main points of AstraZeneca’s key drug developments, so I won’t repeat them here.But, to summarise, AstraZeneca is making impressive progress in its key lines of oncology and diabetes research. So I really don’t think we should see the AstraZeneca share price as a Covid-19 play. I do fear, however, that’s how a lot of investors see it right now.AstraZeneca share price valuationWill I buy? That depends on whether the company really has got its pipeline primed to produce regular successes in the coming years. And if I think we can expect a period of steady earnings growth. I can’t tell from the Q1 figures, which were skewed by the disposal of AstraZeneca’s 26.7% share of Viela Bio. That raised a profit of $776m. First-half results, due in July, will be fuller and will hopefully give me a better insight.In the meantime, I’m thinking about the AstraZeneca share price valuation. They ended 2020 on a P/E of around 40. And this year’s share price gains push that trailing multiple as high as 47. That’s the kind of level I’d expect for a smaller growth stock, and it does seem to assume there’ll be some stellar growth from AstraZeneca in the next few years.And AstraZeneca shares have been volatile, and do seem to be cyclical. Even with no obvious change in the company’s long-term outlook, investors can swing from not touching it with a bargepole, to pumping it up like the next great growth stock.Waiting for steadier timesAs I suggested, I really do think Covid-19 lies behind a lot of the current AstraZeneca share price bullishness. But I don’t expect it to figure greatly in the company’s long-term future. Covid has quickly become one of the world’s best-researched ailments. While the worldwide effort has been nothing short of remarkable, it does mean there’s huge competition out there for these vaccines.Right now, I’m not going to buy. Today’s valuation, and the Covid-19 effect, make me want to wait until things are more settled. And when the dividend starts rising again, that’s when I’ll be truly convinced that sustainable earnings growth is back. Simply click below to discover how you can take advantage of this. Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. See all posts by Alan Oscroftlast_img read more