QuidelOrtho assumed with Neutral from Sell at UBS

UBS analyst Lu Li upgraded QuidelOrtho to Neutral from Sell with a price target of $50, up from $42, after assuming coverage of the name. The firm sees a path to 500 basis points of margin expansion in the next two years and free cash flow “restoration” driven by sales independent cost initiatives. However, channel channel checks and a detailed view of QuidelOrtho’s portfolio suggest limited growth upside due to potential headwinds in the Lab segment and lack of future growth opportunities across the portfolio, the analyst tells investors in a research note. UBS sees the stock’s current valuation as fair.