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On Monday, BMO Capital analysts revised their outlook on Regeneron Pharma stock (NASDAQ: NASDAQ:REGN), reducing the price target to $600 from $800 while keeping an Outperform rating. The adjustment follows disappointing results from the phase 3 studies of itepekimab for treating COPD, where only one of the two studies achieved statistical significance. The news has contributed to the stock’s 16.7% decline over the past week, pushing it near its 52-week low of $485.
The analysts highlighted the increased challenges in obtaining approval for itepekimab, leading them to lower the probability of success for the drug to 0%. As a result, any potential contributions from the company’s pipeline were removed from the valuation model.
The report indicated that recent regulatory and clinical challenges have affected Regeneron Pharma’s pipeline, prompting the need for a more cautious approach. Despite these setbacks, BMO Capital continues to maintain an Outperform rating for the stock.
The revised price target reflects the analysts’ updated model, which incorporates a more conservative stance due to the recent developments. The analysts emphasized the need for Regeneron Pharma to demonstrate further progress to justify the current rating.
In other recent news, Regeneron Pharmaceuticals has announced a licensing agreement with Hansoh Pharmaceuticals to develop and commercialize a new obesity drug candidate, HS-20094, outside of China. This deal involves an $80 million upfront payment and potential future payments up to $1.93 billion. Additionally, Regeneron shared interim results from its Phase 2 COURAGE trial, which showed that combining semaglutide with muscle-preserving antibodies significantly preserved lean mass and increased fat loss in obese patients. Meanwhile, RBC Capital Markets downgraded Regeneron’s stock rating from Outperform to Sector Perform, citing disappointing results from the clinical trials of the drug candidate itepekimab. Despite this, Guggenheim maintained a Buy rating with a price target of $810, following mixed results from the AERIFY trials for itepekimab in treating COPD. The AERIFY-1 study met its primary endpoint, but AERIFY-2 did not, potentially delaying further developments. Raymond (NSE:RYMD) James also kept a Market Perform rating, noting that the mixed outcomes do not significantly alter their assessment of Regeneron’s financial trajectory. These developments reflect the company’s ongoing efforts in research and development, while also highlighting challenges in its clinical pipeline.
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