BofA update shows where active managers are putting money
Investing.com - William Blair has reiterated an Outperform rating on Apellis Pharmaceuticals (NASDAQ:APLS), which has seen its shares decline 46% over the past six months, following the company’s royalty purchase agreement with Sobi. According to InvestingPro data, the company maintains a healthy financial position with a current ratio of 4.08.
The research firm views the royalty deal as positive for Apellis, noting it provides additional financial flexibility and addresses concerns about potential needs for additional financing.
William Blair continues to see blockbuster potential for Apellis’ Syfovre treatment in geographic atrophy (GA), citing its superior efficacy compared to competitor Izervay as a driver for significant market share gains once physician focus shifts beyond safety concerns.
Beyond Syfovre, the firm highlights promising results from the VALIANT study in C3G/IC-MPGN, which demonstrated "best-in-class efficacy" for a condition affecting an estimated 5,000 U.S. patients, representing another potential revenue driver pending approval by its July 28 PDUFA date.
William Blair notes Apellis currently trades at an enterprise value of 2.2 times its 2025 revenue estimate, below the 8.5 times median for comparable midcap companies launching new products into large markets, suggesting a "value disconnect" as investors focus on near-term competitive pressures rather than long-term outlook. InvestingPro analysis indicates the stock is currently undervalued, with additional insights and detailed valuation metrics available in the comprehensive Pro Research Report.
In other recent news, Apellis Pharmaceuticals has entered into a royalty agreement with Sobi, potentially bringing in up to $300 million in non-dilutive funding. The deal involves an upfront payment of $275 million and an additional $25 million contingent on European regulatory approval for Aspaveli in treating certain rare kidney diseases. This agreement allows Apellis to retain exclusive U.S. commercialization rights for Aspaveli, marketed as EMPAVELI. Additionally, the company is eligible for tiered royalties on ex-U.S. sales, ranging from high teens to high twenties percentage points. In parallel, Apellis presented findings from the Phase 3 VALIANT study at the European Renal Association Congress, showing EMPAVELI’s efficacy in reducing proteinuria and stabilizing kidney function in patients with C3G and IC-MPGN. The study highlighted a 68% reduction in proteinuria at 26 weeks, sustained over a year, and consistent safety and tolerability profiles. Wells Fargo (NYSE:WFC) analysts have raised Apellis Pharmaceuticals’ stock price target to $29, maintaining an Equal Weight rating. They noted the potential of C3G/IC-MPGN treatments but remain cautious about the company’s financial strategies and the performance of its Syfovre product.
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