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Investing.com - Piper Sandler has reduced its price target on Sarepta Therapeutics (NASDAQ:SRPT) to $18.00 from $32.00 while maintaining a Neutral rating on the stock. The stock, currently trading at $13.37, has fallen over 90% in the past year. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value assessment.
The adjustment follows Friday’s confirmation from Sarepta that the FDA requested the company voluntarily stop shipments of Elevidys for all patients, a request the company denied for ambulatory patients.
Sarepta will continue shipping Elevidys for ambulant Duchenne muscular dystrophy (DMD) patients despite the FDA’s concerns, which Piper Sandler believes stem from "continued liver safety events observed with SRPT’s AAVrh74 vector."
The research firm outlined potential regulatory outcomes, noting that a forced withdrawal could take years and involve lengthy litigation, while a Risk Evaluation and Mitigation Strategy (REMS) program might be a more practical solution to prioritize patient safety.
Piper Sandler has adjusted its Elevidys revenue outlook to a "$500M floor," which drives the significant reduction in price target from $32 to $18.
In other recent news, Sarepta Therapeutics is facing significant challenges as the U.S. Food and Drug Administration (FDA) placed a clinical hold on its gene therapy trials for limb girdle muscular dystrophy (LGMD). This hold affects several of Sarepta’s programs, including SRP-9003, SRP-9004, SRP-6004, and SRP-9005. The FDA also revoked Sarepta’s platform technology designation for its AAVrh74 platform, complicating the company’s strategic plans. The clinical hold follows controversy involving a patient death, leading to concerns about Sarepta’s transparency and safety practices. Analysts have responded with mixed ratings: Cantor Fitzgerald and TD Cowen maintained Neutral and Hold ratings, respectively, while Guggenheim reiterated a Buy rating despite acknowledging the company’s credibility issues. Guggenheim expressed concerns over Sarepta’s management and suggested potential changes to the leadership. Sarepta’s management aims to discuss with the FDA a pathway to submit a Biologics License Application for SRP-9003 once the hold is lifted. As Sarepta approaches 1,000 patients treated with its therapies, safety concerns remain a focal point for analysts and investors alike.
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