On Thursday, Oppenheimer maintained its Outperform rating on United Therapeutics Corp . (NASDAQ:UTHR) and increased the shares target to $400 from $375 following the company's first-quarter financial update.
United Therapeutics reported a 34% total revenue growth year-over-year for the first quarter of 2024, surpassing expectations. This growth was attributed to a combination of factors, including increased referrals and new patient starts for its drug Tyvaso, as well as the impact of the Inflation Reduction Act's Medicare Part D redesign, which has led to greater commercial drug utilization.
The company's performance in the first quarter did not exhibit its typical seasonal patterns, which was noted in the analyst's previous preview note dated April 22, 2024.
The absence of this seasonality, along with the aforementioned factors, is expected to provide a tailwind for the company's performance over the next few quarters. The analyst from Oppenheimer highlighted the company's fiscal discipline as a contributing factor to improving margins.
As a result of the strong first-quarter results and the positive outlook, Oppenheimer has revised upward its revenue and earnings per share (EPS) estimates for United Therapeutics.
The improved financial projections underpin the decision to raise the price target on the company's stock. The analyst remains bullish on United Therapeutics, expecting its current growth trajectory to continue in the near term.
InvestingPro Insights
United Therapeutics Corp.'s (NASDAQ:UTHR) robust first-quarter performance is further reflected in its financial metrics and market behavior. The company's market capitalization stands at an impressive $11.32 billion, signaling strong investor confidence. With a Price to Earnings (P/E) ratio of just 11.1, United Therapeutics is trading at a value that is attractive relative to its near-term earnings growth, as indicated by a PEG ratio of 0.26. These figures suggest not only profitability but also potential for growth, which aligns with the positive sentiments expressed by Oppenheimer.
The company's financial discipline is evident in its substantial gross profit margin of nearly 88.87% over the last twelve months as of Q1 2024, showcasing its ability to manage costs effectively while expanding its revenue streams. Additionally, the company's stock has been performing well, with a significant return over the last week of 8.13% and a strong return over the last three months of 19.55%, indicating a positive short-term trend. Notably, United Therapeutics holds more cash than debt on its balance sheet, an InvestingPro Tip that highlights the company's financial stability and potential for sustained growth without the pressure of high leverage.
For investors looking for more in-depth analysis and additional InvestingPro Tips, United Therapeutics Corp. has a total of 11 tips available on InvestingPro. To access these insights and more, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.