Street Calls of the Week
On Monday, Raymond (NSE:RYMD) James maintained a Strong Buy rating on shares of Blueprint Medicines (NASDAQ:BPMC), with a price target of $130.00. Currently trading at $111.50, with a market capitalization of $7.1 billion, the stock has garnered a favorable consensus among analysts, as shown by InvestingPro data. The firm’s analysis suggests that the target price, which is set at 4 times enterprise value (EV) to five-year forward sales and 10 times EV to next twelve months (NTM) sales, is slightly higher than the average for Blueprint Medicines’ biotech commercial growth peer group. The premium is supported by the successful commercialization of AYVAKIT, increasing diagnoses of Indolent Systemic Mastocytosis (ISM), and potential within Blueprint Medicines’ deeper product pipeline, particularly with BLU-808.
The firm’s research indicates that allergy Key Opinion Leaders (KOLs) not affiliated with major medical centers or those who currently do not have ISM patients are beginning to screen for ISM. This trend is attributed in part to outreach by Blueprint Medicines and word-of-mouth in the medical community. The company’s commercial success is reflected in its impressive 100.9% revenue growth over the last twelve months, maintaining a remarkable 97% gross profit margin. Additionally, some allergy KOLs are referring patients to hematologists for suspected ISM, a sign of growing awareness and diagnosis rates for the disease.
Raymond James does not consider COGT’s bezuclastinib ISM data, expected in the summer of 2025, as a significant threat to Blueprint Medicines’ dominance in the ISM market. Instead, the firm believes that the data will enhance the medical community’s overall understanding of ISM.
Blueprint Medicines is projected to surpass its own guidance of $2 billion in revenue by 2030, driven by the growth of the ISM total addressable market (TAM), which is expected to expand due to increased diagnosis rates and improved testing methods, such as ultra-sensitive reverse transcription polymerase chain reaction (rcPCR). Raymond James forecasts $2.1 billion in global revenue for AYVAKIT by the year 2030. According to InvestingPro analysis, the stock has shown strong momentum over recent months, though it currently appears slightly overvalued based on their Fair Value model. For deeper insights into Blueprint Medicines’ financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Blueprint Medicines saw a substantial increase in its revenue, primarily driven by robust sales of its therapeutic product, Ayvakit, used for treating systemic mastocytosis. Ayvakit generated $128.2 million in net product revenue, marking a 137% year-over-year increase. As a result, Blueprint Medicines revised its revenue expectations for the year to between $475 million and $480 million. Analysts from Piper Sandler, Stifel, JPMorgan, and Needham have all maintained a positive outlook on the company’s prospects, citing the promising BLU-808 trial data and the updated sales projections for Ayvakit as key drivers of Blueprint Medicines’ growth. In terms of future developments, Blueprint Medicines is preparing to release data from the BLU808 Single Ascending Dose/Multiple Ascending Dose study next year and plans to initiate the registration-enabling study for Elenestinib by the end of 2024. These developments are expected to broaden the company’s reach in targeted therapies for cancer and rare diseases.
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