U.S. stocks lower as investors rotate out of tech ahead of Jackson Hole
On Tuesday, H.C. Wainwright reiterated its Buy rating and $75.00 price target for Legend Biotech Corp . (NASDAQ:LEGN), pointing to the company's strategic positioning amid shifting political and economic landscapes. Currently trading at $30.25, the stock sits near its 52-week low of $29.31, while analyst targets range from $53.12 to $95.00. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value assessment. Analysts at the firm highlighted Legend Biotech's resilience to tariff exposure and regulatory uncertainties, factors increasingly important to investors in the current market environment.
Legend Biotech has emphasized its lack of material exposure to tariffs, underpinning the company's confidence in its operational stability. The firm manufactures its CARVYKTI treatment for commercial patients within the U.S. and Europe, negating the need for importation that could be subject to tariffs. This operational efficiency has contributed to impressive revenue growth of 120% over the last twelve months, with InvestingPro data showing strong financial health metrics and a comfortable current ratio of 4.62. The production relies on a lentiviral vector, a crucial starting material for CAR-T therapies, which is produced in the company's bioreactors located in Switzerland and New Jersey.
The company's strategic positioning is further strengthened by its intellectual property (IP) arrangements. Legend Biotech's U.S. IP for CARVYKTI is domiciled domestically, while the ex-U.S. IP is based in Ireland. This structure ensures that the company is not exposed to transfer pricing risks, which could affect profitability and operational efficiency. With over $627 million in revenue and holding more cash than debt on its balance sheet, the company maintains a solid financial foundation. Discover more insights about Legend Biotech's financial position in the comprehensive Pro Research Report, available exclusively on InvestingPro.
H.C. Wainwright's reaffirmation of the Buy rating and price target reflects confidence in Legend Biotech's business model and its potential to navigate the complexities of international trade and regulation. The $75.00 price target suggests a positive outlook for the stock over a 12-month period, aligning with the broader analyst consensus that remains bullish on the company's prospects.
In summary, H.C. Wainwright's analysis indicates that Legend Biotech's strategic foresight in manufacturing and IP domicile is a significant advantage. The firm's manufacturing capabilities within key markets and prudent IP management are seen as protective measures against the unpredictable nature of tariffs and regulatory changes. These factors contribute to the firm's reiterated Buy rating and price target for Legend Biotech stock.
In other recent news, Legend Biotech reported fourth-quarter 2024 financial results that surpassed analyst expectations, with revenue reaching $186.52 million, exceeding the projected $173.99 million. The company's CARVYKTI treatment generated net trade sales of approximately $334 million in the fourth quarter and $963 million for the full year. Legend Biotech has treated over 5,000 patients with CARVYKTI to date. Analysts at RBC Capital, BMO Capital Markets, and Piper Sandler have maintained positive ratings on Legend Biotech, citing strong growth prospects and revenue potential. RBC Capital forecasts CARVYKTI revenues to reach $1.93 billion in 2025, while BMO Capital highlights potential revenue doubling due to facility expansions. Piper Sandler projects CARVYKTI sales to grow significantly, with expectations for $1.75 billion in 2025 and $2.9 billion in 2026. H.C. Wainwright raised its price target for Legend Biotech to $75, maintaining a Buy rating, aligning with the company's sales expectations for 2025. Legend Biotech's financial position remains robust, with $1.1 billion in cash, anticipated to support operations until reaching profitability in 2026.
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