Guggenheim maintains Buy rating on Sarepta stock despite FDA dispute

Investing.com - Guggenheim has reiterated its Buy rating and $22.00 price target on Sarepta Therapeutics (NASDAQ:SRPT), despite ongoing regulatory challenges that have severely impacted the company’s stock performance. According to InvestingPro data, analyst targets for the stock range from $9 to $110, with the company’s shares currently trading near $14, suggesting significant analyst divergence on the stock’s outlook.

The research firm noted that Sarepta management’s "misinterpretation of materiality" regarding a patient death in a Phase 1 clinical trial of a discontinued program has "destroyed the last vestiges of credibility." While the FDA was informed of the situation in real-time, Guggenheim highlighted that public disclosures were inadequate. This comes as InvestingPro analysis shows the company is quickly burning through cash, with negative free cash flow of $695 million in the last twelve months.

The situation escalated when the FDA requested Sarepta voluntarily halt commercial shipments of Elevidys to ambulant Duchenne muscular dystrophy patients, a request the company declined. Guggenheim indicated this refusal has created "acrimony" that will likely slow Elevidys’ commercial uptake and potentially impact timelines for key pipeline assets.

Guggenheim suggested that "nothing short of changes to the C-suite is likely to suffice" to address the situation, while questioning whether the company’s board is prepared to make such changes.

Sarepta stock closed 36% lower on Thursday, July 18, 2025, and has declined 87% year-to-date, significantly underperforming the 6% year-to-date decline in the SPDR S&P Biotech ETF (XBI).

In other recent news, Sarepta Therapeutics is facing significant challenges following a series of developments related to its gene therapy, Elevidys. The FDA has requested a halt to shipments of Elevidys after reports of three liver-related patient deaths, prompting H.C. Wainwright to reiterate its Sell rating and reduce its price target to $0. Despite this, Sarepta plans to continue shipments to ambulatory patients, citing a favorable risk/benefit profile. BofA Securities maintained its Neutral rating and $20 price target, noting that Elevidys will likely remain available for now. Meanwhile, Wells Fargo (NYSE:WFC) kept its Overweight rating and $65 price target, expecting resilience in Elevidys’ ambulatory indication. The FDA has not formally requested the removal of Elevidys from the market, but Sarepta has voluntarily paused shipments to non-ambulatory patients. JPMorgan lowered its price target for Sarepta to $20, maintaining an Overweight rating, and highlighted the potential upside if Elevidys remains available for ambulatory patients. These developments have raised concerns about Sarepta’s transparency and financial outlook, with TD Cowen reiterating a Hold rating due to credibility issues with patient groups.

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