U.S. stocks lower as investors rotate out of tech ahead of Jackson Hole
On Tuesday, Truist Securities adjusted its price target on Legend Biotech Corp. (NASDAQ: LEGN) shares, bringing it down to $71 from the previous $71 while sustaining a Buy rating for the company. Currently trading at $31.07, the stock is near its 52-week low of $29.27, though InvestingPro analysis suggests the stock may be undervalued. Wall Street remains broadly optimistic, with analyst targets ranging from $53 to $95. The revision follows Legend Biotech’s first-quarter 2025 earnings report, which showed a 10% quarter-over-quarter increase in Carvykti sales. The growth was characterized by a modest 5% increase in the U.S. and a more substantial 65% surge outside the U.S., attributed to the ramp-up of Obelisc. This growth contributes to Legend’s impressive 120% year-over-year revenue increase, though InvestingPro data shows the company is yet to achieve profitability, with analysts not expecting positive earnings this year.
The anticipated acceleration in sales is now expected to occur in the second half of 2025 rather than the second quarter, as previously forecasted. This shift is due to the Novartis (SIX:NOVN) facility still scaling up to meet the commercial demand for Carvykti. According to the report, around 60% of Carvykti’s sales are currently generated from second-line (2L) treatments, while the demand for fifth-line (5L) treatments is on the decline. Despite current challenges, Legend maintains strong financial health with more cash than debt on its balance sheet and a healthy current ratio of 4.62, according to InvestingPro data.
The number of authorized treatment centers (ATCs) for Carvykti has increased to 114, with over half of the treatments now being administered on an outpatient basis. The upcoming American Society of Clinical Oncology (ASCO) meeting is set to feature five-year data from the CARTITUDE-1 study. Additionally, data from the CARTITUDE-2 study, which focuses on first-line (1L) treatments, as well as in-vivo CAR-T readouts, are expected to be released in the latter half of 2025.
The price target adjustment to $71 from $88 by Truist Securities reflects a more conservative outlook on Carvykti’s growth trajectory for the year 2025, taking into account the slower than expected uptake of the treatment.
In other recent news, Legend Biotech Corp reported its first-quarter financial results for 2025, revealing total revenues of approximately $195 million. This figure surpassed the revenue forecast of $192.54 million but fell short of Raymond (NSE:RYMD) James’ estimate of $203 million. Despite this revenue growth, the company posted a net loss of $101 million, with an adjusted net loss of $27 million. Legend Biotech’s flagship product, CARVICTI, showed significant sales growth, reaching $369 million, marking a 135% year-over-year increase. The company maintains a strong cash position with around $1 billion, which is expected to sustain operations until projected profitability by the end of 2025 for CARVICTI and during 2026 for the company as a whole. Raymond James reaffirmed its Outperform rating on Legend Biotech, with a price target of $86, citing CARVICTI’s competitive positioning and potential market expansion. The company also plans to expand its market presence in Europe and the US, alongside developing an in vivo CAR T platform. These developments underscore Legend Biotech’s robust growth trajectory and strategic market expansions.
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