Avadel stock price target raised to $20 from $13 at UBS on strong Lumryz sales

Investing.com - UBS raised its price target on Avadel Pharmaceuticals (NASDAQ:AVDL) to $20.00 from $13.00 on Thursday, while maintaining a Buy rating on the stock. Currently trading at $14.25 with a market capitalization of $1.33 billion, the company has received strong analyst support, with InvestingPro data showing analyst targets ranging from $13 to $24.

The price target increase follows Avadel’s second-quarter results, which showed Lumryz sales of $68 million, exceeding UBS estimates of $59 million and consensus expectations of $61 million. The stock has risen 20% following these results, contributing to an impressive 69% gain over the past six months. InvestingPro analysis reveals the company maintains exceptional gross profit margins of 89.64% and has achieved revenue growth of 132.35% in the last twelve months.

UBS cited positive market expansion, quarter-over-quarter net pricing improvement, and enhanced patient mix and persistency rates as key factors driving Lumryz’s performance. The firm noted that over 50% of the 3,100 patients using Lumryz at the end of the second quarter were switch patients, compared to approximately 38% in the fourth quarter of 2024.

The investment bank views this patient composition shift as significant because switch patients typically demonstrate higher retention rates compared to new or discontinued oxybate patients. UBS also incorporated risk-adjusted peak sales of $340 million for the IH (idiopathic hypersomnia) indication into its valuation model.

Avadel is expanding its commercial efforts, investing in direct-to-patient initiatives and increasing its sales force to 60 representatives in the second quarter, which UBS believes will further support the Lumryz launch.

In other recent news, Avadel Pharmaceuticals reported its financial results for the second quarter of 2025, significantly exceeding earnings and revenue expectations. The company achieved an earnings per share (EPS) of $0.10, which was notably higher than the forecasted $0.03, representing a 233.33% surprise. Revenue reached $68.1 million, surpassing the anticipated $61.4 million. These results highlight a strong performance for Avadel Pharmaceuticals. The company’s stock experienced a notable increase following the announcement of these results. Such developments are crucial for investors monitoring Avadel’s financial health. This performance may influence future analyst evaluations and investment decisions.

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