On Thursday, Amgen Inc . (NASDAQ:AMGN) shares saw its price target increased by Mizuho from the previous $223.00 to $235.00. The firm kept its rating unchanged while adjusting the target. This adjustment comes despite lingering questions about Amgen's Phase 2 obesity drug candidate, MariTide (AMG133).
Mizuho's commentary highlighted the recent positive remarks from Amgen's management regarding MariTide and the subsequent rise in the company's stock price.
However, the firm pointed out that there are still many unanswered questions about the asset. The firm's valuation concerns stem from its discounted cash flow (DCF) analysis, which suggests a value of less than $200, even when factoring in some potential revenue from the obesity treatment.
The current trading levels of Amgen's stock, according to Mizuho, seem to be supported by investors using price-to-earnings (P/E) based valuation methods rather than DCF. This indicates a divergence in valuation approaches between the firm's analysis and market sentiment.
Amgen's management has been optimistic about the prospects of MariTide, which is reflected in the recent upward movement of its stock. Nevertheless, Mizuho's stance remains cautious due to the valuation discrepancies noted in their report.
The increased price target of $235.00 suggests that Mizuho acknowledges the positive market reaction to Amgen's developments while maintaining a conservative outlook on the company's valuation. The firm's maintained rating indicates that, despite the price target change, their overall view on Amgen's stock has not shifted significantly.
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