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On Monday, Guggenheim maintained a Buy rating on Neurocrine Biosciences (NASDAQ:NBIX) but lowered the price target to $163 from $165. The adjustment follows the company’s fourth-quarter sales report, which showed Ingrezza sales slightly below consensus estimates. Neurocrine Biosciences, which has demonstrated strong revenue growth of 24.8% over the last twelve months, reported approximately $615 million in Ingrezza sales for the fourth quarter of 2024, which was about 1% lower than the $623 million market consensus and approximately 2.5% below Guggenheim’s estimate of $631 million.
The company also missed earnings expectations, with non-GAAP EPS at $1.69 compared to the Street’s estimate of $2.02. The news triggered a significant market reaction, with the stock declining 18.3% over the past week. Analysts attributed the shortfall primarily to increasing competitive pressure and payor dynamics, which also led to the company’s forecast for fiscal year 2025 Ingrezza sales being set between $2.5 billion and $2.6 billion, below the consensus estimate of $2.67 billion. According to InvestingPro, three analysts have recently revised their earnings estimates downward for the upcoming period.
Despite these challenges, management expressed confidence in the long-term potential of their product Crenessity, although they anticipate initial growth to be gradual. Neurocrine Biosciences is also advancing its clinical pipeline, with plans to initiate pivotal trials for their ’845 program in Major Depressive Disorder (MDD) and ’568 program in schizophrenia in the first half of 2025.
Further, the company is looking forward to several key catalysts, including a Phase II readout in MDD with NBI-770 (NR2B NAM) and Phase III readouts in Dyskinetic Cerebral Palsy and adjunctive schizophrenia with valbenazine expected in 2025. These developments are part of the reason for the continued Buy rating, despite the slight decrease in the price target to $163.
In other recent news, Neurocrine Biosciences has been the subject of several analyst reports. H.C. Wainwright reduced its stock price target for Neurocrine Biosciences to $185, following the company’s announcement that its flagship product, Ingrezza, generated $615 million in revenue, slightly missing the consensus forecast. Despite this, the firm maintained a Buy rating on the stock, citing Ingrezza’s low market penetration and favorable risk-benefit profile.
BofA Securities also revised its price target for Neurocrine Biosciences to $179, while maintaining a Buy rating. The revision was in response to the company’s full-year 2024 Ingrezza revenues of $2.31 billion, which were slightly below estimates. The company’s guidance for 2025 also fell short of consensus estimates.
Canaccord Genuity lowered its price target for Neurocrine Biosciences to $163 but kept a Buy rating. The firm adjusted its Ingrezza sales estimates for 2025, aligning with the company’s updated sales outlook range. Despite the lowered price target, Canaccord expects the drug to experience growth in the subsequent years.
Cantor Fitzgerald reaffirmed its Overweight rating on Neurocrine Biosciences stock with a consistent price target of $170. The firm updated its financial model for the company, which included adjustments to drug sales estimates and extending their discounted cash flow analysis.
These are recent developments that investors should consider when evaluating Neurocrine Biosciences.
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