Ionis stock rating gets boost from Jefferies as firm dramatically shifts to bullish

On Tuesday, Ionis Pharmaceuticals, Inc. (NASDAQ:IONS) stock received a significant upgrade by a Jefferies analyst from Underperform to Buy, accompanied by a substantial increase in the price target to $75.00, up from the previous $29.00.

This adjustment comes as the analyst recognizes potential growth opportunities for the company, particularly with its Eplontersen treatment in ATTR-CM, which is undergoing Phase 3 trials with data expected by mid-2026.

Ionis's stock, trading around $48, is seen to have room for growth. The optimism is anchored on the anticipated positive outcome of the ongoing Phase 3 CARDIO-TTRansform study for Eplontersen, which is expected to show statistical significance, especially in combination therapy scenarios.

The analyst suggests that while a competing study, HELIOS-B, is likely to miss on combination therapy, Eplontersen could demonstrate efficacy that would encourage its adoption as a first-line treatment.

Beyond Eplontersen, the analyst points to Ionis's "de-risked base business," which includes products such as Spinraza and Donislecel, as well as the company's net cash position, estimating a net present value (NPV) of approximately $35. The firm's diversified pipeline, featuring treatments like Olezarsen and Pelacarsen, provides additional avenues for potential growth and value creation.

The bullish stance from Jefferies reflects a belief in Ionis's ability to deliver on its pipeline's promise, with a diversified array of products that could drive the company's stock higher. The new price target of $75.00 represents a significant increase from the current trading level, suggesting confidence in the company's future performance.

In other recent news, Ionis Pharmaceuticals has seen significant developments. The U.S. Food and Drug Administration accepted for Priority Review the New Drug Application for olezarsen, a potential treatment for familial chylomicronemia syndrome. Ionis also secured a licensing agreement with Otsuka Pharmaceutical, granting exclusive rights to commercialize the investigational medicine donidalorsen in the Asia-Pacific region and Europe, pending regulatory approvals.

In the realm of analyst notes, Bernstein SocGen Group upgraded Ionis stock from Underperform to Market Perform, while BMO Capital maintained its Outperform rating on Ionis. Other recent developments include the announcement of positive outcomes from Phase 3 clinical trials for Donidalorsen, demonstrating a significant reduction in monthly hereditary angioedema attack rates and improved patients' quality of life.

These recent developments highlight the ongoing progress and potential of Ionis Pharmaceuticals in the biotechnology sector. Please note, these are recent developments and not a comprehensive view of the company.

InvestingPro Insights

The recent upgrade by Jefferies for Ionis Pharmaceuticals underscores the potential for growth, a sentiment echoed by several metrics available on InvestingPro. With a market capitalization of $6.94 billion and a high Price/Book ratio of 23.4 as of the last twelve months ending Q1 2024, Ionis is trading at a premium, which could be justified by its promising pipeline and recent positive stock performance, including a strong return of 17.02% over the last month.

Despite challenges such as a projected sales decline in the current year and weak gross profit margins, with a gross profit margin of -19.02% in the last twelve months as of Q1 2024, Ionis has revised earnings expectations upwards, according to 4 analysts. This could indicate confidence in the company's long-term strategy and its treatments in development. Additionally, the company's liquid assets exceed its short-term obligations, providing financial stability.

For investors looking for deeper insights, there are additional InvestingPro Tips available on InvestingPro, which could help in making a more informed decision. With the provided coupon code PRONEWS24, readers can get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription to access these valuable tips and metrics.

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