Goldman Sachs (NYSE:GS) has adjusted its stance on Ascendis Pharma (NASDAQ: NASDAQ:ASND), reducing the stock's price target to $180 from the previous $195.
The firm continues to endorse a Buy rating for the pharmaceutical company. This shift comes in response to lower-than-expected sales of Ascendis Pharma's drug Skytrofa and revised revenue forecasts.
Ascendis Pharma's shares experienced a significant drop, plunging 20% in after-market trading. The decline followed the announcement of the company's second-quarter financial results for 2024, which showed Skytrofa sales at €26.1 million. These figures fell short of Goldman Sachs and Visible Alpha's consensus estimates, which were approximately €70.9 million and €74.6 million, respectively.
The company has also revised its full-year 2024 revenue guidance for Skytrofa, reducing it to a range of €220 million to €240 million. The previous forecast was between €320 million and €340 million. The adjustment is attributed to changes in insurance contracts and prevailing market conditions.
Looking ahead, the market's attention is expected to turn to Ascendis Pharma's upcoming U.S. launch of Yorvipath and a newly announced royalty agreement. Analysts anticipate that the company's ability to reach a breakeven point in quarterly operating cash flow, now expected in 2024 or 2025, will be a key factor for investors. This outlook is contingent on the speed at which Ascendis can ensure commercial supply of Yorvipath in the U.S. market.
In other recent news, Ascendis Pharma has secured a $150 million royalty deal with Royalty Pharma for its FDA-approved treatment for hypoparathyroidism in adults, YORVIPATH. The agreement includes a 3% royalty on the U.S. net sales of the drug. In response to these developments, several analyst firms have updated their outlooks on Ascendis Pharma.
JPMorgan (NYSE:JPM) has increased its price target for the company to $174 and maintains an Overweight rating. Goldman Sachs followed suit, raising its price target for Ascendis to $195 and forecasting peak sales of EUR 1.6 billion for Yorvipath.
TD Cowen upgraded Ascendis Pharma's stock rating from Hold to Buy, and Stifel initiated coverage on Ascendis Pharma with a Buy rating and a $200 price target.
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