On Monday, H.C. Wainwright maintained a Buy rating and a $180.00 stock price target on Axsome Therapeutics (NASDAQ:AXSM), highlighting the company's strong financial performance in the third quarter of 2024. Axsome's revenue for the quarter exceeded expectations, coming in at $104.8 million, surpassing the analyst's projection of $93.9 million.
The revenue for the quarter was primarily driven by $103.7 million in product sales, complemented by approximately $1 million in royalty revenue. Axsome's leading product, AUVELITY (dextromethorphan plus bupropion), contributed over $80 million to the total sales for this period. Additionally, the company's second marketed product, Sunosi (solriamfetol), generated sales of $23.4 million in the same quarter.
Following the strong quarterly results, H.C. Wainwright has increased its full-year 2024 revenue forecast for Axsome to $384.1 million, up from the previous estimate of $359.4 million. Moreover, the firm's full-year 2025 revenue projection has been adjusted to $691.9 million from the earlier estimate of $686.8 million.
The analyst's reiteration of the Buy rating and the 12-month price target of $180 per share reflects confidence in Axsome's financial growth and market performance. This endorsement comes after the company's demonstrated ability to surpass revenue expectations and deliver significant sales through its marketed products.
In other recent news, Axsome Therapeutics witnessed a significant surge in its third-quarter earnings, with revenues surpassing $100 million for the first time. This marked an 81% year-over-year increase, largely attributed to the sales of its major depressive disorder treatment, Auvelity, and the excessive daytime sleepiness medication, Sunosi.
Despite these gains, Axsome reported a net loss of $64.6 million while maintaining a robust cash reserve of $327.3 million. RBC Capital Markets has maintained an 'Outperform' rating on Axsome shares, with a price target increase to $132, reflecting the company's recent financial performance and prospective milestones. The firm's analysis suggests Axsome's growth will persist into 2025, backed by its robust late-stage pipeline.
Recent developments include Axsome's plans to expand its sales force for Auvelity and preparation for the potential launch of its migraine treatment, AXS-07. However, the FOCUS study for solriamfetol in ADHD has been delayed to the first quarter of 2025.
InvestingPro Insights
Axsome Therapeutics' strong financial performance, as highlighted by H.C. Wainwright, is further supported by recent InvestingPro data. The company's revenue growth has been impressive, with a 51.47% increase over the last twelve months and an even more substantial 81.27% growth in the most recent quarter. This aligns with the analyst's increased revenue forecasts for 2024 and 2025.
InvestingPro Tips reveal that Axsome boasts impressive gross profit margins, which is evident in the latest data showing a gross profit margin of 91.09% for the last twelve months. This high margin suggests efficient cost management and strong pricing power for its products, AUVELITY and Sunosi.
Despite the positive revenue growth, an InvestingPro Tip indicates that analysts do not anticipate the company will be profitable this year. This is consistent with the reported operating income margin of -72.65% and the negative EPS of -$6.53 for the last twelve months. However, the company's liquid assets exceeding short-term obligations, as noted in another tip, provides some financial stability as Axsome continues to invest in growth.
Investors should note that Axsome is trading near its 52-week high, with a significant price uptick of 31.24% over the last six months. The stock's current price is 93.98% of its 52-week high, reflecting strong market confidence in line with H.C. Wainwright's bullish outlook.
For those seeking a more comprehensive analysis, InvestingPro offers 7 additional tips that could provide further insights into Axsome Therapeutics' financial health and market position.
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