On Wednesday, H.C. Wainwright adjusted its outlook on argenx SE (NASDAQ:ARGX), a biotechnology company, by raising its price target to $490 from the previous $448. Alongside the price target increase, the firm maintained a Buy rating on the company's stock.
The revision follows recent developments including the approval of argenx's drug Vyvgart for Chronic Inflammatory Demyelinating Polyneuropathy (CIDP) on Friday and the unveiling of promising data for another drug candidate, empasiprubart, at the 2024 Peripheral Nerve Society Annual Meeting. Empasiprubart, also known as ARGX-117, is currently being evaluated for its effectiveness in treating multifocal motor neuropathy (MMN), a rare condition. The Phase 2 ARDA study data indicated that empasiprubart led to a clinically meaningful improvement in grip strength for patients.
The analyst from H.C. Wainwright cited the positive data as a significant factor in boosting investor confidence in the long-term profile of argenx. The firm's updated valuation also reflects an increased probability of success for empasiprubart, up to 60% from the prior estimate of 50%. Additionally, the price/sales multiple applied to the company's 2035 risk-adjusted revenue estimate was raised to 8.7 times from 8 times.
The analyst expressed optimism about the commercial trajectory of Vyvgart and the potential for the CIDP launch to contribute to the expansion of argenx's stock multiples. The positive developments for both Vyvgart and empasiprubart are seen as key drivers for the company's future growth.
In other recent news, argenx SE has made significant strides, particularly with the approval of its drug Vyvgart-Hytrulo for Chronic Inflammatory Demyelinating Polyneuropathy (CIDP). This development has prompted several analyst firms, including Truist Securities, TD Cowen, Wells Fargo (NYSE:WFC), Piper Sandler, Scotiabank, and H.C. Wainwright to revise their price targets and ratings for the company.
Truist Securities has raised its target to $480, anticipating that peak sales of Vyvgart in the U.S. for CIDP could reach around $2.2 billion. TD Cowen sustained its Buy rating and a price target of $514.00, highlighting the potential of flexible pricing strategies for Vyvgart Hytrulo.
Wells Fargo raised its price target on argenx shares to $542, maintaining an Overweight rating. Similarly, Piper Sandler increased its price target to $535, citing the strong initial performance in the gMG market and the robust clinical data supporting its use in CIDP. Scotiabank adjusted its price target for argenx to $416, while maintaining a Sector Perform rating, and H.C. Wainwright has maintained a Buy rating with a target of $448.
These revisions come in the wake of argenx's impressive financial performance, with an 83% increase in total operating income to $413 million, largely propelled by the expansion of Vyvgart. The company has also increased its salesforce to target a larger pool of 10,000 neurologists, up from the initial 2,700 prescribers, indicating potential for further market expansion.
InvestingPro Insights
Following the upbeat analysis by H.C. Wainwright, current metrics from InvestingPro further illuminate the financial landscape for argenx SE (NASDAQ:ARGX). The company boasts a solid market capitalization of $27.42 billion, underpinning its significant presence in the biotech industry. This is bolstered by a remarkable revenue growth of 126.96% over the last twelve months as of Q1 2024, showcasing the company's rapid expansion and the market's positive reception to its products. Additionally, argenx has experienced a strong 1-month price total return of 23.01%, reflecting the market's response to recent developments and approvals.
InvestingPro Tips suggest that while argenx holds more cash than debt, indicating a stable financial position, the stock is currently in overbought territory according to the Relative Strength Index (RSI). Moreover, analysts do not expect the company to be profitable this year, and it has been trading at a high Price/Book multiple of 6.7. For investors seeking a deeper analysis, there are over 10 additional InvestingPro Tips available, offering a comprehensive outlook on argenx's financial health and market performance. To access these insights, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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