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Investing.com - TD Cowen raised its price target on Madrigal Pharmaceuticals (NASDAQ:MDGL) to $554 from $390 on Tuesday, maintaining a Buy rating on the stock. The company, currently valued at $9.2 billion, has seen its shares surge over 61% in the past year, trading near its 52-week high of $423.20.
The price target increase follows the European Union’s approval of Rezdiffra, Madrigal’s liver disease treatment.
TD Cowen analyst Ritu Baral cited the EU approval as the primary reason for updating the firm’s financial model to include an EU discounted cash flow analysis.
The analyst also noted a reduction in the discount rate applied to Madrigal’s valuation due to lower risk following the regulatory approval.
Madrigal Pharmaceuticals, which focuses on developing treatments for liver and cardiovascular diseases, received the significant price target boost representing a 42% increase from TD Cowen’s previous target.
In other recent news, Madrigal Pharmaceuticals has received significant attention following the European Commission’s approval of its MASH treatment, Rezdiffra. This approval marks Rezdiffra as the first medication for noncirrhotic MASH with moderate to advanced liver fibrosis in the European Union. The authorization covers all 27 EU countries, as well as Iceland, Liechtenstein, and Norway. Madrigal plans to launch Rezdiffra in Germany next quarter, targeting around 370,000 patients diagnosed with F2/F3 MASH. Meanwhile, Citizens JMP has raised its price target for Madrigal to $485, maintaining a Market Outperform rating. In another development, Goldman Sachs reiterated its Buy rating with a $567 price target, despite the competitive landscape changing due to Novo Nordisk’s Wegovy receiving accelerated approval for NASH treatment. Additionally, Cantor Fitzgerald maintained its Neutral rating on Madrigal, focusing on the company’s new weight-based dosing patent for Rezdiffra, which is valid until February 2045. These recent developments have kept Madrigal Pharmaceuticals in the spotlight among investors and analysts.
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