Citi lifts Rigel stock price target to $55, maintains Buy rating

On Thursday, Citi analysts increased their price target on shares of Rigel Pharmaceuticals (NASDAQ:RIGL) to $55.00, up from the previous target of $49.00, while reiterating a Buy rating on the stock. Currently trading at $20.29, the company has earned a "GREAT" financial health score on InvestingPro, supported by impressive revenue growth of ~55% in the last twelve months. The firm’s analysts highlighted Rigel’s effective strategy in establishing a robust commercial franchise over the past three years. The combined revenue from Tavalisse, Rezlidhia, and the newly acquired Gavreto is projected to approach $200 million by 2025.

Rigel’s current business operations are seen as substantial enough to justify a valuation of $45 per share, which implies a 131% upside. Notably, the company is generating positive cash flow, with an anticipated $20 million in positive operating cash flow for 2024. The company’s strong liquidity position is evidenced by a healthy current ratio of 2.13, with liquid assets exceeding short-term obligations. This financial health indicates that the company is growing its resources rather than depleting them.

The analysts also pointed out several promising aspects of Rigel’s pipeline. These include plans to expand Rezlihdia into mid-stage trials for mIDH1 glioma later this year, the IRAK1/4 R289 asset targeting the larger, lower-risk MDS market, additional clinical work in other mIDH1 malignancies in cooperation with MD Anderson, and the RIPK1 partnership with Eli Lilly (NYSE:LLY) focusing on autoimmune diseases.

The Citi analysts’ statement underscores the potential of Rigel’s diverse portfolio and its strategic partnerships, which contribute to the positive outlook on the company’s stock. According to InvestingPro analysis, the stock appears slightly undervalued at current levels. The analysts’ confidence in Rigel is evident in the reiterated Buy rating and the increased price target, reflecting the company’s solid commercial progress and promising pipeline developments. For deeper insights into Rigel’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro along with 10+ additional ProTips and extensive financial metrics.

In other recent news, NeuroPace Inc. reported total revenue of $21.5 million, reflecting a year-over-year growth of approximately 19%. This revenue figure slightly exceeded the projections by Cantor Fitzgerald and surpassed the FactSet consensus estimate, driven by increased sales of the company’s medical devices. NeuroPace also completed a capital raise, which is expected to facilitate share repurchases and support the company’s product development timeline for the NAUTILUS project. Cantor Fitzgerald analyst Ross Osborn raised the stock price target for NeuroPace to $20.00, maintaining an Overweight rating.

Rigel Pharmaceuticals announced its fourth-quarter and full-year financial results for 2024, with earnings per share surpassing both firm and consensus estimates. The company reported fourth-quarter revenue of $57.6 million, with product revenues from Tavalisse, Rezlidhia, and Gavreto contributing significantly. H.C. Wainwright maintained a Buy rating on Rigel with a $57.00 price target, highlighting the company’s strong performance and future growth plans, including international expansion of its therapies.

Cantor Fitzgerald reiterated a Neutral rating on Rigel Pharmaceuticals, maintaining a $20.00 price target. The firm’s valuation approach included a net present value of Rigel’s free cash flow and a placeholder for its early-stage pipeline. Rigel’s financial model update aligns with the company’s guidance, supporting the price target based on Rigel’s cash position and projected shares. These developments reflect the firm’s comprehensive assessment of Rigel’s financial health and prospects.

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