On Monday, TD Cowen adjusted its outlook on Legend Biotech Corp. (NASDAQ:LEGN) shares, lowering the price target to $67 from $71 while maintaining a Buy rating on the stock. The firm's assessment reflects a more conservative estimate for the ramp-up of Carvykti, a cancer treatment drug.
The revised price target comes amid expectations of modest growth in the second quarter. As manufacturing capacity expands, growth is anticipated to pick up in the latter half of the year.
Despite the adjustment, the analyst remains optimistic about the company's long-term performance, projecting an exit from the 2025 fiscal year with the capability to produce 10,000 doses of Carvykti.
Legend Biotech is also expected to present data on another of its cancer treatments, Anito-cel, at the American Society of Hematology (ASH) meeting. The analyst suggests that while the data is likely to be preliminary, it may not outshine Carvykti's results.
Furthermore, the firm mentioned a potential risk from BIOSECURE, a process developed by GenScript, which could prompt Johnson & Johnson to consider acquiring Legend Biotech. This scenario is hypothesized due to the interconnected business interests between the companies.
TD Cowen's revised price target reflects a decrease of $4, aligning the forecast with the anticipated gradual increase in manufacturing capacity and the strategic implications for Legend Biotech's future operations.
In other recent news, Legend Biotech has been the recipient of positive analyst attention due to the significant overall survival benefits reported in the Phase 3 trial for CARVYKTI, a treatment for relapsed or refractory multiple myeloma patients.
H.C. Wainwright and BMO Capital have maintained their Buy and Outperform ratings respectively, with H.C. Wainwright setting a price target of $73.00 and BMO Capital at $90.00. RBC Capital has also reiterated its Outperform rating, citing strong demand for CARVYKTI and improved manufacturing metrics.
Piper Sandler projects that CARVYKTI's revenues will reach $900 million this year, with a substantial increase to $1.75 billion by 2025. These projections reflect the analysts' confidence in Legend Biotech's strategic direction and the commercial prospects of CARVYKTI. The company is also progressing with two allogeneic therapies and ended the first quarter of 2024 with approximately $1.3 billion in cash reserves.
In addition to these developments, Legend Biotech has also received approval from the U.S. Food and Drug Administration for CARVYKTI as a treatment for adult patients with relapsed or refractory multiple myeloma.
The results from the second interim analysis of the CARTITUDE-4 study demonstrated a meaningful improvement in overall survival, with safety outcomes consistent with CARVYKTI's known safety profile. These findings are expected to be presented at an upcoming medical meeting and discussed with regulatory agencies around the world for potential label updates.
InvestingPro Insights
Legend Biotech Corp. (NASDAQ:LEGN) has shown a remarkable revenue growth of 206.05% over the last twelve months as of Q1 2024, indicating a strong upward trajectory in its financial performance. This is complemented by substantial recent returns, with the stock delivering a 14.68% return over the last week and an even more impressive 28.08% over the past month. These metrics suggest that investor sentiment has been positive, despite the broader market trends.
An InvestingPro Tip highlights that Legend Biotech holds more cash than debt on its balance sheet, providing financial stability and the potential for strategic investments or operations expansion. This could be particularly relevant given the anticipated growth in the second half of the year as manufacturing capacity for Carvykti increases. Additionally, analysts foresee sales growth in the current year, aligning with TD Cowen's outlook for the company's long-term performance.
For readers looking to delve deeper into Legend Biotech's investment potential, there are 11 additional InvestingPro Tips available, which can be accessed by visiting https://www.investing.com/pro/LEGN. To gain comprehensive insights and make informed investment decisions, consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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