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On Thursday, RBC Capital Markets adjusted its financial outlook on Biogen shares, reducing the price target to $221 from $225 while maintaining an Outperform rating. According to InvestingPro data, the stock is currently trading near its 52-week low of $128.51, with analyst targets ranging from $135 to $342, suggesting significant potential upside. The company maintains a healthy financial profile with an InvestingPro Financial Health score of "GOOD." Brian Abrahams of RBC Capital Markets shared insights on Biogen’s quarterly performance, noting an expectation for revenues to align closely with consensus estimates at $2.25 billion versus the $2.24 billion forecast. This comes as the company’s trailing twelve-month revenue stands at $9.68 billion, with a robust gross profit margin of 76%. Spinraza, Biogen’s treatment for spinal muscular atrophy, is anticipated to slightly outperform expectations, generating $390 million against a $382 million consensus, which underscores the resilience of the product amidst a competitive landscape.
However, Abrahams pointed out that Biogen’s multiple sclerosis (MS) treatments, Avonex and Tysabri, are projected to underperform relative to consensus estimates, with anticipated revenues of $153 million and $355 million respectively, compared to the $163 million and $370 million forecasted. These figures reflect the challenges faced by the MS franchise.
Biogen’s Alzheimer’s drug, Leqembi, is expected to meet projections, with revenue anticipated at $86 million, aligning with market estimates and on track with partner Eisai’s full-year 2024 guidance of $280 million. Abrahams mentioned that Biogen’s disciplined approach to research and development spending is conducive to growth, which is likely to result in a bottom-line beat with an estimated earnings of $3.82 per share versus the consensus of $3.56 per share.
Despite a current lack of near-term catalysts as Biogen navigates its strategic direction, RBC Capital sees inherent value in the stock. The firm suggests that potential positive developments, such as subcutaneous administration for Leqembi and approval in the European Union, could provide momentum, or significant business development could materialize. InvestingPro analysis reveals additional insights, with 8 more ProTips available for subscribers, including detailed valuation metrics and growth prospects. Get access to the comprehensive Pro Research Report, available for Biogen and 1,400+ other top US stocks, to make more informed investment decisions.
In other recent news, Biogen Inc (NASDAQ:BIIB). received Fast Track designation from the FDA for its investigational Alzheimer’s drug, BIIB080, following promising Phase 1b study results. This designation is intended to expedite the development and review of the drug, which targets tau protein in early-stage Alzheimer’s patients. In a separate development, Organon acquired the U.S. rights to TOFIDENCE™, a biosimilar developed by Biogen for treating arthritis and certain COVID-19 cases. The acquisition terms include an upfront payment and tiered royalties based on net sales. Additionally, Biogen has announced plans to establish a new headquarters in Cambridge, Massachusetts, by 2028, consolidating its operations into a single innovation hub.
Analyst activity has also been notable, with Oppenheimer maintaining an Outperform rating for Biogen, alongside a $255 price target, following Biogen’s collaboration with Stoke Therapeutics (NASDAQ:STOK) on a potential Dravet syndrome treatment. Conversely, Piper Sandler reduced its price target for Biogen to $135 while keeping a Neutral rating, citing concerns over declining revenue forecasts and competitive pressures. The firm noted Biogen’s clean capital structure, which provides flexibility for potential mergers and acquisitions. These recent developments highlight Biogen’s strategic focus on expanding its pipeline and maintaining its position in the neurology and rare diseases market.
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