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On Wednesday, Citizens JMP reiterated its Market Outperform rating on Protagonist Therapeutics (NASDAQ:PTGX) with a steady price target of $58.00. Currently trading at $37.75 with a market capitalization of $2.25 billion, InvestingPro analysis indicates the stock is slightly undervalued. Analyst Jonathan Wolleben at Citizens JMP expressed a positive outlook for the company, largely based on the potential of its drug candidate, icotrokinra. Wolleben highlighted the upcoming developments with another drug, rusfertide, which is in partnership with Takeda, as a key factor for Protagonist’s valuation.
Protagonist Therapeutics is at a pivotal juncture with rusfertide, as the company will soon decide whether to opt-in for a 50/50 profit/loss share in the U.S. market, along with a 10-17% royalty outside the U.S., and the possibility of earning up to $330 million in milestone payments. Alternatively, Protagonist could opt-out and instead receive a $400 million payment and 14-29% royalties on worldwide sales. The company’s strong financial position is evident in its excellent InvestingPro Financial Health Score of 3.98, with a robust current ratio of 10.7 indicating solid liquidity to support either strategic direction.
Citizens JMP’s analysis suggests that the opt-in scenario could yield a net present value (NPV) of approximately $2.1 billion. This figure is significant as it nearly matches Protagonist’s current valuation of $2.3 billion. The firm’s valuation model reflects a strong belief in the commercial potential of rusfertide and the strategic decisions Protagonist will make upon New Drug Application (NDA) approval.
The strategic choice Protagonist faces with rusfertide’s NDA approval is crucial. Opting in would involve a more hands-on approach with shared profits and losses in the U.S. and royalties abroad. On the other hand, opting out would result in a substantial immediate payment and higher royalties on global sales.
Wolleben’s commentary underscores the importance of rusfertide to Protagonist’s future financial health. The decision on how to proceed post-NDA approval will be a defining moment for the company, with significant implications for its revenue stream and market valuation. According to InvestingPro data, analysts maintain a strong buy consensus with price targets ranging from $43 to $68, suggesting significant upside potential. Subscribers can access the comprehensive Pro Research Report for deeper insights into Protagonist’s valuation metrics and growth prospects.
In other recent news, Protagonist Therapeutics has been the subject of several analysts’ reports. Truist Securities reiterated its Buy rating on the company, focusing on the potential of drug candidate rusfertide for treating polycythemia vera (PV), a type of blood cancer. Similarly, JMP Securities maintained its Market Outperform rating, highlighting the benefits of rusfertide for PV patients. Jefferies also confirmed a Buy rating on Protagonist Therapeutics, emphasizing the company’s ongoing developments with rusfertide and icotinib, another drug candidate.
In addition to analyst ratings, the company has undergone an executive role change with Suneel Gupta, Ph.D., transitioning from Chief Development Officer to Executive Vice President, Clinical Development. Furthermore, Clear Street initiated coverage on Protagonist Therapeutics with a Buy rating, citing the company’s promising drug candidates and potential for significant royalty and milestone earnings as key drivers behind the positive outlook.
These are recent developments that provide investors with an understanding of the company’s current standing and future prospects. It’s important to note that these developments do not offer a comprehensive view of the company, but they do offer a snapshot of recent events that may be of interest to investors.
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