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On Tuesday, BMO Capital Markets adjusted its outlook on Neurocrine Biosciences, raising the company’s price target from $96.00 to $115.00. The firm maintained its Market Perform rating on the NASDAQ-listed shares (NASDAQ:NBIX). This adjustment follows Neurocrine’s reported revenues for Crenessity, which exceeded expectations. The company has demonstrated strong financial health with a 24.8% revenue growth over the last twelve months, according to InvestingPro data.
BMO Capital’s analyst highlighted the impressive early performance of Crenessity, acknowledging the potential positive impact on Neurocrine’s shares in the near term. However, the analyst also pointed out potential challenges ahead, particularly concerning the commercial dynamics of Ingrezza, a key product for Neurocrine, as it approaches the year 2025. InvestingPro analysis suggests the stock is currently undervalued, with a healthy current ratio of 3.4 and moderate debt levels.
According to the analyst, meeting the 2025 guidance for Ingrezza will likely necessitate a shift in the current growth trajectory of the asset. The analyst notes that while Neurocrine may have improved access to markets, it is possible that concessions made in gross to net (GTN) could limit the benefits of market expansion. Despite these challenges, InvestingPro data reveals the company maintains strong profitability with a robust gross margin of 67.5%. Subscribers can access 8 additional ProTips and comprehensive financial analysis in the Pro Research Report.
The report further mentions that while adding to the sales force could enhance long-term care (LTC) market penetration, a significant increase in growth would require an acceleration that has not been observed thus far. Despite the increase in the price target, the analyst’s stance indicates a cautious optimism, recognizing the early success of Crenessity but also the hurdles that lie ahead for Neurocrine Biosciences. The company trades at a P/E ratio of 32.6, with analysts projecting continued profitability for the upcoming year.
In other recent news, Neurocrine Biosciences reported its first-quarter 2025 earnings, with a diluted non-GAAP EPS of $0.70 and revenue of $572.6 million, surpassing some Wall Street expectations but missing others. Despite the mixed earnings results, the company reaffirmed its sales guidance for Ingrezza, estimating 2025 sales between $2.5 billion and $2.6 billion. Piper Sandler adjusted its price target for Neurocrine Biosciences to $154, while maintaining an Overweight rating, anticipating prescription growth for Ingrezza. Needham raised its price target slightly to $139, maintaining a Buy rating, following the company’s earnings report that exceeded expectations, particularly for Ingrezza sales. Evercore ISI increased its price target to $190, retaining an Outperform rating, citing strong new patient starts for Ingrezza and a positive outlook for the company’s performance. The launch of Crenessity has also shown early success, with 413 prescriber signatures and $14.5 million in sales, exceeding expectations. Analysts from Piper Sandler and Evercore ISI highlighted the potential for continued growth in the company’s product portfolio and its impact on investor sentiment.
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