Bullish indicating open at $55-$60, IPO prices at $37
On Wednesday, Baird analyst Brian Skorney reaffirmed a positive stance on Regenxbio Inc . (NASDAQ:RGNX) with an Outperform rating and a $39.00 price target, representing significant upside from the current price of $8.52. The stock has shown strong momentum with a 16.94% gain over the past week. According to InvestingPro data, analyst consensus remains bullish, with price targets ranging from $14 to $52, suggesting substantial growth potential for this $422 million market cap company. Skorney’s confidence in the company remains steady following the latest management update on the AFFINITY DUCHENNE trial, which is currently in Phase I/II. The trial’s additional interim data from two patients showed promising results, with one younger patient achieving expression levels in the triple digits as a percentage of normal.
Skorney believes that these results bolster the narrative that Regenxbio could secure a significant portion of the market share for incident cases in the future. The safety profile of the treatment continues to be a critical factor, especially in light of recent developments from competitor Sarepta Therapeutics (NASDAQ:SRPT). InvestingPro analysis shows the company maintains strong liquidity with a current ratio of 2.69 and holds more cash than debt on its balance sheet, providing financial flexibility to advance its clinical programs. Get access to 7 more exclusive InvestingPro Tips and comprehensive financial analysis through the Pro Research Report, available with an InvestingPro subscription. Regenxbio’s RGX-202 therapy has not shown any serious adverse events or events of special interest, which is significant given the death of a patient in a Sarepta trial earlier in the week.
The analyst noted that while the death in Sarepta’s trial has caused concern within the Duchenne Muscular Dystrophy (DMD) community, it is unlikely to have a major impact on Regenxbio’s commercial strategy. This is because Regenxbio is expected to focus on a younger, lighter patient population upon commercial launch. Additionally, management highlighted the potential differentiation of RGX-202, citing the short-course immune modulation regimen and high product purity levels.
Despite the positive interim data, Skorney emphasized the need for a larger treated patient population to confirm the safety profile and potential differentiation of RGX-202. With only 11 patients treated so far, a more extensive sample size is required to fully understand the therapy’s safety and efficacy. While analysts anticipate sales growth in the current year, InvestingPro data indicates the company is currently burning through cash, with a negative free cash flow of $175.56 million in the last twelve months, highlighting the importance of successful clinical development for future value creation. Nevertheless, the analyst sees an advantage in Regenxbio’s ability to learn from the issues faced by Sarepta’s Elevidys and to potentially limit safety risks by focusing on younger patients with less advanced disease.
In other recent news, Regenxbio Inc. reported its fourth-quarter 2024 financial results, which included a revenue of $21.2 million and a net loss of $51.2 million, or ($1.01) per share. This net loss was better than the anticipated loss of $65.9 million. Despite the revenue falling short of the forecasted $23.47 million, the earnings per share surpassed expectations, reporting -1.01 against a forecast of -1.13. Analysts from H.C. Wainwright adjusted the company’s stock target to $34.00 from $36.00, maintaining a Buy rating, while Stifel reiterated a Buy rating with a $40.00 price target.
Regenxbio has shared promising interim data from its Phase I/II AFFINITY DUCHENNE trial for RGX-202, showcasing positive biomarker results with high microdystrophin expression levels in young patients. The company also completed its Biologics License Application submission for RGX-121, seeking accelerated approval for treating Mucopolysaccharidosis II. Raymond (NSE:RYMD) James raised the stock target to $29.00, maintaining an Outperform rating, highlighting the safety profile of Regenxbio’s RGX-202 treatment.
The company is advancing its gene therapy pipeline, with significant developments expected in 2025, including the anticipated FDA approval of RGX-121 and progress in their Duchenne muscular dystrophy gene therapy study. Regenxbio’s collaboration with AbbVie (NYSE:ABBV) continues in the retinal disease field, with ongoing Phase 3 trials for RGX-314 targeting wet age-related macular degeneration and diabetic retinopathy. These developments reflect Regenxbio’s strategic focus on expanding its gene therapy portfolio and its potential impact on treating rare diseases.
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