Canaccord Genuity reiterates Buy rating on Regeneron stock despite EYLEA headwinds

Investing.com - Canaccord Genuity has reiterated its Buy rating and $850.00 price target on Regeneron Pharmaceuticals (NASDAQ:REGN) stock despite acknowledging headwinds for the company’s EYLEA franchise. The target represents significant upside potential from the current price of $557.73, and InvestingPro analysis suggests the stock is currently undervalued.

The research firm maintained its positive outlook on Regeneron while noting the challenges facing EYLEA, one of the company’s key revenue-generating products. Despite these challenges, the company maintains strong financials with a healthy gross profit margin of 47.35% and robust revenue of $14.2 billion over the last twelve months.

Canaccord Genuity believes the upcoming readout from Novo Nordisk’s semaglutide in Alzheimer’s disease (AD) could draw investor attention to Regeneron’s program due to its muscle-sparing attributes.

The firm suggested that if Novo’s readout proves positive, Regeneron might consider using its trevogrumab and/or garetosmab treatments in combination with a GLP-1 for Alzheimer’s disease.

Regeneron’s potential strategic pivot toward Alzheimer’s treatments could represent a significant opportunity for the company as it faces challenges with its established EYLEA franchise.

In other recent news, Regeneron Pharmaceuticals has announced several significant developments. The U.S. Food and Drug Administration approved Regeneron’s drug Libtayo for use in adult patients with cutaneous squamous cell carcinoma (CSCC) at high risk of recurrence after surgery and radiation. This approval was based on the Phase 3 C-POST trial, which showed a 68% reduction in disease recurrence or death compared to placebo. Additionally, Cantor Fitzgerald has reiterated its Overweight rating for Regeneron, maintaining a price target of $678, following the company’s third-quarter financial results, which were described as largely in line with expectations.

RBC Capital has also raised its price target for Regeneron to $704, citing the strong growth of its Dupixent drug. The firm expects Dupixent to exceed expectations, with an increased estimate of $4.73 billion in sales, compared to the consensus estimate of $4.59 billion. Meanwhile, Scholar Rock has faced challenges as the FDA recommended regulatory actions against a third-party manufacturing facility used by the company. This issue at the Catalent Indiana facility, owned by Novo Nordisk , may delay Scholar Rock’s biologics license application resubmission. These developments highlight the dynamic nature of the pharmaceutical industry and its impact on company operations and investor expectations.

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