Coherus stock rating upgraded on Loqtorzi sales growth

On Tuesday, Coherus Biosciences (NASDAQ:CHRS) shares, currently trading at $1.04 with a market capitalization of $120 million, received an upgrade from H.C. Wainwright, with the firm’s analysts raising the stock rating from Buy to Buy and maintaining a price target of $7.00. According to InvestingPro data, analyst price targets range from $1.50 to $8.00, reflecting varied expectations for the stock’s potential. The upgrade came in response to the successful launch and sales performance of Coherus’s cancer treatment, Loqtorzi. In the fourth quarter, Loqtorzi sales reached $7.5 million, marking a 29% growth quarter over quarter.

The company’s management reported that the number of new accounts purchasing Loqtorzi increased by 37%. Additionally, new patient starts continued to rise, particularly in the relapsed, locally advanced, and first-line metastatic settings. This growth contributes to the company’s impressive year-over-year revenue growth of 44%, as reported in InvestingPro’s latest financial analysis. This growth occurred despite some negative impact from disruptions related to the planned divestiture of another of the company’s products, Udenyca.

Coherus’s management highlighted the importance of the National Comprehensive Cancer Network’s (NCCN) guidelines revision in November. The NCCN now recommends Loqtorzi as the only preferred regimen in combination with chemotherapy for treating advanced nasopharyngeal carcinoma (NPC) in the first-line setting and beyond. Despite NPC being a rare disease, the company has noted that awareness of these guidelines is more prevalent among head and neck cancer specialists, and efforts are ongoing to increase awareness in hospitals, which typically see fewer NPC patients.

The company estimated that the awareness of the NCCN guidelines stands at around 40%. They are actively working to boost this number to enhance Loqtorzi’s uptake. InvestingPro analysis reveals several challenges, including significant debt burden and rapid cash burn. These are among the 12+ key insights available to Pro subscribers, along with detailed financial health scores and comprehensive valuation metrics. Through interactions with physicians, the company found that the CFS OS data was generally convincing and led to a preference for following the NCCN guidance. However, management has indicated that the full impact of the guidelines on Loqtorzi’s uptake is not expected to materialize until the latter half of 2025.

In conclusion, H.C. Wainwright’s analysts have reiterated their confidence in Coherus Biosciences, maintaining a Buy rating and a $7.00 price target for the company’s stock, based on the solid progress of the Loqtorzi launch and the potential for further growth as awareness of the NCCN guidelines increases. According to InvestingPro’s Fair Value analysis, the stock currently appears fairly valued. For a deeper understanding of Coherus’s financial health, growth prospects, and valuation metrics, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Coherus BioSciences Inc. reported its fourth-quarter 2024 earnings, which showed a notable revenue performance that exceeded expectations. The company announced a revenue of $54.1 million, surpassing the forecast of $44.15 million, while the earnings per share (EPS) were slightly better than anticipated at -$0.28 compared to the expected -$0.30. Coherus BioSciences is also in the process of divesting its UDENYCA franchise, a move that is expected to significantly impact its cash reserves, with projections of cash and cash equivalents reaching $250 million post-divestiture. UDENYCA net sales for the quarter were reported at $46.3 million, marking a 28% increase year-over-year. Additionally, Lactorzi, another key product for Coherus, saw a 29% quarter-over-quarter increase in net revenue, totaling $7.5 million for the quarter. The company is undergoing strategic shifts, including divestitures and headcount reductions, to focus on its oncology pipeline. These developments come amid Coherus BioSciences’ strategic transition to position itself as a leader in innovative oncology treatments.

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