On Wednesday, RBC Capital adjusted its outlook on Biohaven Pharmaceutical (TADAWUL:2070) Holding (NYSE:BHVN), reducing the stock's price target from $68.00 to $66.00, while retaining an Outperform rating.
The revision follows Biohaven's third-quarter earnings report for 2024, which was released earlier in the day. The company's pipeline was highlighted as being on schedule for significant developments expected by year-end, particularly in Spinal Muscular Atrophy (SMA) and its IgG degrader program.
The analysts from RBC Capital remarked on the potential of Biohaven's pipeline, noting the opportunity for up to a 30% upside in the SMA sector. Despite a decrease in investor interest for the IgG degrader program, the firm believes that a successful outcome could lead to a 20% upside in the stock's value. The analysts' comments underscored the anticipation for Biohaven's forthcoming clinical readouts.
Looking beyond the immediate future, RBC Capital has identified additional catalysts for Biohaven in 2025, particularly with the Kv7 program. The firm's optimism is bolstered by the success of competitors and positive feedback from key opinion leaders (KOLs) in the field. This positive outlook is part of the rationale behind the recommendation to buy into Biohaven's stock ahead of the clinical results.
"With a catalyst rich end to the year and additional opportunities in 2025, we would be buyers into BHVN's clinical readouts; price target to $66 on model updates," said RBC.
In other recent news, BofA Securities has reiterated their Buy rating for Biohaven's shares and raised the price target to $63, based on positive updates from the company's troriluzole treatment for spinocerebellar ataxia (SCA). If approved, analysts suggest troriluzole could achieve peak U.S. sales of over $1.5 billion.
Biohaven's ongoing Phase 3 trial for Spinal Muscular Atrophy (SMA), named RESILIENT, is testing the company's myostatin inhibitor, known as t-alfa. BofA Securities forecasts a $780 million peak sales potential for t-alfa, pending the strength of the trial data. Leerink Partners, meanwhile, retained an Outperform rating for Biohaven, citing optimism from recent Phase 3 trial data from competitor Scholar Rock.
InvestingPro Insights
To complement RBC Capital's analysis of Biohaven Pharmaceutical Holding (NYSE:BHVN), recent data from InvestingPro offers additional context for investors. Despite the optimistic outlook on Biohaven's pipeline potential, it's important to note that the company is not currently profitable, with a negative P/E ratio of -6.64 over the last twelve months as of Q2 2024. This aligns with an InvestingPro Tip indicating that analysts do not anticipate the company will be profitable this year.
However, Biohaven's stock has shown strong performance, with a remarkable 75.04% total return over the past year. This robust growth is reflected in another InvestingPro Tip highlighting the company's high return over the last year. The stock's momentum is further evidenced by a 49.08% price return over the past six months, suggesting investor confidence in the company's future prospects.
For those considering an investment in Biohaven, it's worth noting that InvestingPro offers 14 additional tips that could provide deeper insights into the company's financial health and market position. These tips, along with real-time metrics, can be valuable tools for investors looking to make informed decisions as Biohaven approaches its critical clinical readouts and potential value inflection points in the coming year.
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