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On Friday, UBS analyst Ashwani Verma adjusted the price target for Biogen (NASDAQ:BIIB) shares, bringing it down to $134 from the previous target of $157. Despite the change in price target, the firm maintained a Neutral rating on the stock. According to InvestingPro data, analyst targets for Biogen range from $134 to $342, with the stock currently trading near its 52-week low of $110.03.
Verma's reassessment follows a period of market volatility and proposed trade actions that have impacted the biopharmaceutical sector. Biogen's stock had begun to stabilize, trading at a current P/E ratio of 10.13, with InvestingPro analysis suggesting the stock is undervalued based on its Fair Value calculations. This valuation is at the lower end of the spectrum for large-cap biopharma companies, which typically trade around similar multiples before the loss of exclusivity for major drugs. InvestingPro subscribers have access to 10+ additional valuation metrics and insights about Biogen's true worth.
The UBS analyst highlighted three key areas of investor interest concerning Biogen: the long-term outlook for the Alzheimer's treatment Leqembi, the phasing of first-quarter results, and the potential impact of tariffs and transfer pricing. The revision of the price target to $134 is partly due to a more conservative P/E multiple of 8.5 times, down from the prior multiple of 9.5 times. Additionally, a decrease in the estimated 2026 EPS to $15.64 from the previous estimate of $16.31 was factored into the new target.
The reduction in the price target reflects the broader compression of biopharma multiples amid the recent sell-off in the market. Biogen, along with its peers, has faced challenges that have influenced investor sentiment and valuation metrics. Despite these pressures, UBS's Neutral rating indicates a balanced perspective on the stock's future performance.
In other recent news, Biogen has reported several noteworthy developments. RBC Capital Markets adjusted its price target for Biogen shares to $221, while maintaining an Outperform rating. The firm expects Biogen's revenues to closely align with consensus estimates at $2.25 billion, with Spinraza slightly outperforming expectations. Meanwhile, Biogen's Alzheimer's drug, Leqembi, is anticipated to meet projections, aligning with market estimates. In a significant regulatory update, Biogen's investigational drug BIIB080 received Fast Track designation from the FDA for Alzheimer's treatment, potentially expediting its review process.
In corporate moves, Biogen has announced plans to establish a new global headquarters in Cambridge, Massachusetts by 2028, consolidating its operations into a single innovation hub. Furthermore, Biogen has entered a collaboration with Stoke Therapeutics (NASDAQ:STOK) to develop a treatment for Dravet syndrome, with Oppenheimer maintaining an Outperform rating and a $255 price target for Biogen. Additionally, Biogen has sold U.S. rights for the arthritis biosimilar TOFIDENCE to Organon, marking another strategic move in its portfolio management. These recent developments highlight Biogen's ongoing efforts to innovate and expand its presence in the biotechnology sector.
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