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Tuesday, shares of 3SBio (1530:HK) (OTC:TRSBF) are poised to respond after CLSA raised the company’s price target from HK$12.30 to HK$19.60. The research firm maintained an Outperform (2) rating on the stock. The price adjustment follows the licensing of 3SBio’s product SSGJ-707 to an overseas partner, marking a significant milestone for the company.
David Dong, the analyst at CLSA, noted the de-risking of the asset after the domestic approval of Akeso’s AK112, which is seen as a positive development. The approval is significant as it potentially enhances the value of 3SBio’s product portfolio, specifically SSGJ-707.
The partnership with Pfizer (NYSE:PFE) was highlighted as a key factor for the raised price target, with Pfizer’s robust ADC pipeline assets being compatible for combination therapy. This collaboration is anticipated to bolster SBio’s market presence and future revenue streams.
CLSA’s revised price target is based on an increase in the target PE ratio, which has been raised from 9.8x to 15.0x. The firm’s confidence in the stock is reflected in the substantial lift in the price target, indicating a more optimistic outlook for 3SBio’s financial performance.
3SBio’s strategic moves, including the overseas license-out and the partnership with a pharmaceutical giant like Pfizer, are expected to contribute to the company’s growth trajectory. Investors will be watching how these developments translate into the company’s financial results in the upcoming quarters.
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