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Investing.com - H.C. Wainwright raised its price target on United Therapeutics Corp. (NASDAQ:UTHR) to $500 from $400 on Friday, while maintaining a Buy rating on the stock. The company, currently trading at $380.47, maintains an "EXCELLENT" financial health score according to InvestingPro analysis.
The price target increase follows positive TETON-2 data regarding Tyvaso in idiopathic pulmonary fibrosis (IPF), which led the firm to estimate 2033 peak penetration for IPF of 30% with a 75% probability of approval, resulting in adjusted peak sales of $5.8 billion. The company’s impressive 89% gross profit margin and P/E ratio of 13.75 suggest strong operational efficiency.
H.C. Wainwright’s new $500 price target is based on an equally weighted composite of $459.65 per share (13x multiple of taxed and diluted FY30 GAAP EPS of $54.40 discounted back to FY25 at 9%) and a net present value of $540.47 per share (discount rate 9%, growth rate -1.0%).
The firm noted that its investment thesis faces risks including potential failure of United Therapeutics’ products Remodulin, Tyvaso, Adcirca and Orenitram to achieve peak commercial revenue estimates due to market size, penetration rates, or pricing issues.
Additional risks identified include faster than expected generic erosion of market share of the company’s pulmonary arterial hypertension (PAH) franchise, and flat or rising operating expenses without accretive business development.
In other recent news, United Therapeutics has reported significant developments that have caught the attention of investors and analysts alike. The company announced that its TETON-2 pivotal study for Tyvaso in treating idiopathic pulmonary fibrosis (IPF) met its primary efficacy endpoint, demonstrating a statistically significant improvement in forced vital capacity (FVC) compared to placebo. This positive outcome has led UBS to raise its price target for United Therapeutics from $415 to $560, while maintaining a Buy rating. Similarly, Jefferies increased its price target to $564, also maintaining a Buy rating, following the Phase 3 trial results.
The study showed that nebulized Tyvaso Inhalation Solution achieved a clinically meaningful improvement in FVC and other secondary endpoints, such as time to first clinical worsening event and quality of life measures. In addition to these clinical advancements, United Therapeutics has expanded its partnership with MannKind Corporation to develop a second dry powder inhalation therapy under their existing collaboration. This expansion builds on their previous success with Tyvaso DPI, the first FDA-approved dry powder inhalation treatment for pulmonary hypertension. These recent developments underscore the potential of Tyvaso and the strategic partnerships United Therapeutics is leveraging for future growth.
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