MannKind stock price target raised to $8 by RBC on scPharmaceuticals deal

Investing.com - RBC Capital raised its price target on MannKind (NASDAQ:MNKD) to $8.00 from $7.00 on Tuesday, while maintaining an Outperform rating following the company’s acquisition of scPharmaceuticals (NASDAQ:SCPH). InvestingPro data shows MannKind’s strong financial health, with a "GREAT" overall score and impressive revenue growth of 21.5% over the last twelve months.

The acquisition brings FUROSCIX, a treatment for fluid overload in patients with chronic heart failure and chronic kidney disease, into MannKind’s portfolio. RBC estimates the enterprise value of the deal at $343 million, or $400 million including contingent value rights (CVR).

The transaction multiple represents approximately 2.5 times 2026 estimated consensus revenues of $138 million, or 2.9 times including the CVR. Based on peak consensus revenues of approximately $517 million projected for 2033, the multiple drops to 0.7 times, or 0.8 times with the CVR.

RBC views the acquisition positively, noting it adds a high-growth commercial asset with a large total addressable market of approximately $13 billion.

The firm also highlighted that the deal diversifies MannKind’s revenue base and was completed at what it considers an attractive acquisition multiple.

In other recent news, MannKind Corporation announced its acquisition of scPharmaceuticals Inc. in a deal valued at up to $360 million. The agreement includes a cash payment of $5.35 per share at closing and a contingent value right worth up to an additional $1.00 per share, contingent on regulatory and sales milestones. This acquisition is a significant move for MannKind, with the total equity value at closing around $303 million. Additionally, MannKind reported its second-quarter earnings, which met profit expectations with an adjusted earnings of $0.05 per share. However, the company fell short on revenue, reporting $76.53 million compared to the consensus estimate of $77.83 million. This revenue figure still marks a 6% increase from the same quarter last year. The revenue miss led to a negative reaction from investors. These developments highlight recent strategic and financial activities for MannKind.

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