CIBC: Q1/16 Results - Signs Of StabilizationCIBC report dated May 13, 2016. 12-18 month target US$34.00. What's The Event Concordia reported its Q1 earnings results this morning. Total revenue came in at $228.5MM (CIBC: $224.4MM). Adjusted EBITDA was $140.8MM (CIBC: $138.1MM). The US business seems to have recovered from the negative issues of Q4/15 and has stabilized. With the 175 strong sales force now fully deployed in the field, Donnatal and Nilandron sales are expected to benefit in the coming quarters. Management reiterated its expectation for the US to grow in the low single digits with equal contribution from price and volume. While AMCo revenue came in under our forecast, it appears that most of the discrepancy was related to forex translation. We are pleased to see that the company has now launched 10 products since October 21, 2015. No specifics were provided, except that these are primarily in the UK, and are expected to reach total peak sales of 20M in three years. Concordia acquired the global rights to four generic products for 21MM upfront (2.6x forward revenue), plus 7MM in earn outs. No specific details were provided on these products. Although relatively small, we were surprised by the acquisition, as we would have preferred to see more aggressive pay down of debt. Concordia reiterated 2016 guidance of $1.02B $1.06B revenue, and adjusted EBITDA of $610MM $640MM. Management said that the guidance does not include acquisitions. Our forecasts are for revenue of $974MM , and adjusted EBITDA of $600MM. Our numbers include the reported acquisition. The strategic review process is ongoing, but no details were provided. While we acknowledge it is possible that Concordia may get bought, our analysis remains from the perspective of it being a standalone entity. Please refer to our April 21st note for our thoughts on a buyout. We are maintaining our Sector Performer rating and price target of $34, which we calculated by applying a 7.3x 2017E EV/EBITDA multiple against our 2017E EBITDA estimate (net debt: $3.1B).