Leerink raises Genmab stock rating to outperform, PT steady at $27

On Wednesday, Leerink Partners analyst shifted the rating for Genmab (CSE:GMAB) A/S (NASDAQ:GMAB) stock from Market Perform to Outperform, maintaining a price target (PT) of $27.00. The upgrade reflects a positive long-term outlook despite expectations that Johnson & Johnson (JNJ) is unlikely to opt-in for GEN3014 (Hexabody-CD38), a decision anticipated within the first quarter of 2025.

The analyst believes that Genmab’s current stock price already factors in the market’s low expectations regarding the JNJ opt-in outcome. The focus is now on the company’s proven track record and the potential of its late-stage pipeline programs, which support a favorable view of the stock’s future performance. According to InvestingPro analysis, the company appears undervalued based on its Fair Value calculation, with analyst targets ranging from $23.50 to $50.00.

Genmab’s stock price may experience volatility following the near-term update on GEN3014. However, the analyst’s endorsement suggests confidence in the stock’s value at its current levels, considering the broader context of the company’s history of success.

The analyst’s commentary indicates that the anticipated decision on GEN3014 is not the sole factor in evaluating Genmab’s prospects. Instead, the recommendation to upgrade the stock to Outperform is based on a comprehensive analysis of the company’s pipeline and its ability to succeed in the long term.

In summary, Leerink Partners sees Genmab’s late-stage pipeline programs as a key driver for the company’s future growth, underpinning their decision to upgrade the stock’s rating while holding the price target at $27.00. Investors may watch for further developments, particularly the impending decision from JNJ on GEN3014, which could impact stock performance in the short term.

In other recent news, Genmab has been making significant strides in its financial performance and research developments. The Danish biotechnology company reported a net profit of DKK 3.85 billion for its fourth-quarter earnings, significantly surpassing consensus estimates. Additionally, Genmab’s revenue for the same period met expectations, coming in at DKK 6.44 billion. This robust financial performance has been driven by lower research and development spending and increased financial income.

In terms of future projections, Genmab’s initial outlook for 2025 aligns with expectations, with gross profit forecasts closely matching the consensus. The company is also set to switch its functional currency to the USD as of January 1, 2025. Furthermore, Genmab has provided data to partner Johnson & Johnson for the Phase II study of HexaBody-CD38 ’3014, a potential treatment for relapsed/refractory multiple myeloma.

However, the company has also faced a setback as BioNTech (NASDAQ:BNTX) opted out of further development of the bispecific candidate acasunlimab. Amid these developments, analyst firm Jefferies has highlighted challenges Genmab faces moving forward, leading to a Hold rating.

In other developments, BNP Paribas (OTC:BNPQY) Exane analyst Victor Floch upgraded Genmab shares from Underperform to Neutral, adjusting the price target. The company also announced the granting of restricted stock units and warrants to its employees as part of its employee incentive plan. Lastly, H.C. Wainwright maintained a Buy rating on Genmab shares following positive trial results from Genmab’s partner Janssen.

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