Wednesday - Needham has adjusted its price target for Acadia Pharmaceuticals (NASDAQ:ACAD), bringing it down to $28.00 from the previous $30.00. Despite this reduction, the firm maintains a Buy rating on the stock.
The revision follows Acadia's second-quarter earnings, which revealed a shortfall in Daybue sales, falling short by 6% or approximately $5.5 million compared to consensus estimates. Conversely, sales of Nuplazid exceeded expectations by 7% or about $10.5 million.
The company has also revised its total revenue guidance for 2024, now expecting between $930 million and $980 million, a decrease from the earlier range of $930 million to $1.01 billion.
This adjustment primarily stems from a diminished forecast for Daybue sales, although a more optimistic outlook for Nuplazid somewhat mitigates this.
Acadia's management has confirmed its long-term expectations for Daybue, but it suggests that it may take several quarters for market dynamics to settle and for confidence in growth projections to solidify.
In light of these developments, Needham has recalibrated its sales projections for Daybue, lowering its 2024 estimate to $348 million from the prior $373 million, and the 2025 forecast to $418 million from $520 million. Meanwhile, the firm has increased its sales estimate for Nuplazid.
The revised price target to $28 reflects the firm's updated expectations and the mixed financial performance indicated by Acadia's recent earnings report.
In other recent news, ACADIA Pharmaceuticals (NASDAQ:ACAD) reported robust Q2 2024 earnings, driven by significant revenue growth from its two commercial products, NUPLAZID and DAYBUE, which together generated $242 million.
The company has updated its annual sales guidance for NUPLAZID, reflecting an 11% increase in net product sales. Despite slower growth in new patient starts than expected, DAYBUE also saw an 11% increase in sales.
ACADIA is focusing on educational campaigns to increase awareness of hallucinations and delusions associated with Parkinson's disease. The company, with a robust cash reserve exceeding $500 million and no debt, is well-positioned to fund its future growth and clinical programs, including those for Prader-Willi syndrome and Alzheimer's disease psychosis.
These are among the recent developments that have placed ACADIA Pharmaceuticals in a strong position for future growth. The company plans to target physicians outside of their centers of excellence to grow their business and capture more market share.
InvestingPro Insights
In the wake of Needham's revised price target for Acadia Pharmaceuticals, real-time data and insights from InvestingPro offer additional context for investors. Acadia's market capitalization stands at $3.11 billion, with significant revenue growth of 61.65% over the last twelve months as of Q2 2024. This growth is underscored by a robust gross profit margin of 52.24% in the same period, indicating a healthy capacity for generating profit relative to its sales.
InvestingPro Tips highlight that Acadia holds more cash than debt on its balance sheet, providing financial flexibility and a solid foundation for future growth. Additionally, analysts predict the company will be profitable this year, a positive signal for potential investors. With an impressive 16.86% return over the last month, Acadia's stock performance suggests investor confidence may be on the rise despite recent setbacks.
For those seeking further insights, InvestingPro features an array of additional tips, including a total of 10 more for Acadia, available at InvestingPro. These tips and metrics may offer valuable guidance for investors considering Acadia's stock in the context of its recent earnings report and updated guidance for 2024.
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