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On Monday, Canaccord Genuity adjusted its financial outlook for Neurocrine Biosciences (NASDAQ:NBIX), currently trading at $106.73 with a market capitalization of $10.56 billion, reducing the stock’s price target from $163.00 to $158.00, while still recommending a Buy rating. According to InvestingPro data, 11 analysts have recently revised their earnings estimates downward for the upcoming period. The revision follows a reevaluation of the expected sales for Ingrezza, the company’s lead product, for the first quarter.
Sumant Kulkarni, an analyst at Canaccord Genuity, noted that the new model predicts Ingrezza sales of $550 million, a decrease from the previous estimate of $605 million and slightly below the FactSet consensus of $560 million. The company has demonstrated strong financial performance, with InvestingPro analysis showing impressive revenue growth of 24.81% and a robust current ratio of 3.4, indicating solid liquidity. Despite this adjustment, Kulkarni emphasized that the forecasted sales for 2025 remain at $2.5 billion, which aligns with Neurocrine Biosciences’ own projections and represents a 9% increase over the estimated sales for 2024.
Looking further ahead, the firm has projected a modest decrease in market share and price for Ingrezza starting in 2026, with a subsequent period of low-single digit growth expected in 2027 and beyond. The peak sales for Ingrezza are anticipated to reach $3.6 billion by 2035, which is the last year of the model’s horizon. This figure is slightly lower than the previously estimated peak sales of $3.7 billion.
The reduction in the price target to $158 is primarily attributed to the updated sales figures and has been calculated using a discounted cash flow (DCF) method. Importantly, Kulkarni pointed out that the valuation does not incorporate any specific financial impact from Neurocrine Biosciences’ extensive pipeline, with the exception of international collaboration efforts for Crenessity and the VGYR partnership.
The analyst’s commentary suggests that while the immediate sales projections for Ingrezza have been tempered, the long-term outlook for Neurocrine Biosciences remains positive, supported by a robust pipeline and a solid growth trajectory anticipated in the coming years. InvestingPro analysis indicates the stock is currently undervalued, with an overall financial health score of "GREAT." For deeper insights into NBIX’s valuation and growth potential, including exclusive ProTips and comprehensive financial analysis, investors can access the detailed Pro Research Report, available to InvestingPro subscribers.
In other recent news, Neurocrine Biosciences has seen several notable developments. Stifel analysts have maintained their Buy rating with a $166 price target, highlighting strong initial performance of the company’s drug Crenessity for congenital adrenal hyperplasia (CAH). Feedback from physicians indicates a robust start, with potential for sales to exceed expectations in the coming years. H.C. Wainwright adjusted their price target to $168, maintaining a Buy rating, while noting positive reception of Crenessity among key opinion leaders and patients. Needham upgraded Neurocrine Biosciences stock to Buy with a $138 target, reflecting confidence in Crenessity’s sales potential and the company’s ability to meet revenue guidance. RBC Capital also upgraded the stock to Outperform, setting a price target of $137, emphasizing the strength of the Ingrezza commercial franchise. UBS revised their price target to $137, maintaining a Buy rating, and noted the company’s favorable risk/reward balance in the current biotech climate. These recent developments highlight a mix of optimism and strategic reassessment among analysts regarding Neurocrine Biosciences’ market position and growth potential.
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