On Wednesday, Piper Sandler reiterated its Overweight rating on shares of Day One Biopharmaceuticals (NASDAQ:DAWN), with a steady price target of $40.00. The firm's analysis indicates a substantial uptick in the usage of Day One's drug, Ojemda, among physicians treating pediatric low-grade glioma (pLGG).
The survey results from the third quarter (3Q) suggest an 80% increase in the drug's utilization, with 60% of the respondents being new prescribers during this period. Moreover, there was an 18% quarter-over-quarter rise in penetration.
The low discontinuation rates of Ojemda are expected to contribute to robust commercial performance for the third quarter of 2024. The rate of new patient starts for the drug in 3Q has significantly surpassed initial projections. Consequently, Piper Sandler has adjusted its forecast for Ojemda's net revenues in the third quarter to $18.7 million, up from the consensus estimate of $14.7 million.
For the full fiscal year 2024, Piper Sandler's projections for Ojemda's net revenues have been set at $53.2 million, which is notably higher than the consensus figure of $41.3 million. The firm's stance on the stock remains Overweight, suggesting confidence in the drug's market performance.
The analyst's statement underscores the belief that the launch of Ojemda is proceeding considerably better than anticipated, which could signal promising commercial success for Day One Biopharmaceuticals.
In other recent news, Day One Biopharmaceuticals has seen significant developments. The company reported substantial revenue from the initial sales of Ojemda, with figures reaching $8.2 million, surpassing consensus estimates. This is attributed to substantial patient demand and favorable insurance coverage decisions.
Analyst firm Needham raised the price target on Day One Biopharmaceuticals shares to $33 from $32, maintaining a Buy rating, following an updated market model for Ojemda. The firm's revised third-quarter 2024 revenue projections for Ojemda are now $16.2 million, surpassing consensus estimates by 30%.
Further, Day One Biopharmaceuticals recently acquired DAY301, a promising PTK7-targeting antibody-drug conjugate for solid tumors. This acquisition adds potential growth for the company. Also, the company secured approximately $175 million in an oversubscribed private placement, with the funds set to be used for enhancing commercial capabilities, research, and potential strategic acquisitions.
In terms of analyst notes, Goldman Sachs (NYSE:GS) reaffirmed its Buy rating and $45.00 price target for Day One Biopharmaceuticals. Piper Sandler reaffirmed its Overweight rating on the company, citing strong early utilization of Ojemda.
However, H.C. Wainwright adjusted the price target for Day One Biopharmaceuticals, reducing it to $40.00 but maintained a Buy rating. These are the recent developments for Day One Biopharmaceuticals.
InvestingPro Insights
Day One Biopharmaceuticals' (NASDAQ:DAWN) strong market performance, as highlighted by Piper Sandler's analysis, is reflected in some of the company's financial metrics. According to InvestingPro data, DAWN boasts an impressive gross profit margin of 91.37% for the last twelve months as of Q2 2024, indicating efficient cost management in its core operations. This aligns with one of the InvestingPro Tips, which notes the company's "impressive gross profit margins."
Despite the positive outlook for Ojemda's sales, it's important to note that DAWN is not currently profitable. The company's operating income margin stands at -3509.88% for the same period, and another InvestingPro Tip mentions that DAWN is "not profitable over the last twelve months." This suggests that while revenue growth is strong, the company is still in its growth phase and investing heavily in research and development.
Interestingly, DAWN's stock price "often moves in the opposite direction of the market," according to another InvestingPro Tip. This characteristic could potentially offer diversification benefits for investors. For those seeking more comprehensive analysis, InvestingPro offers 7 additional tips for DAWN, providing a deeper understanding of the company's financial health and market position.
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