On Thursday, Raymond James maintained its Outperform rating on Harmony Biosciences Holdings Inc. (NASDAQ: NASDAQ:HRMY) and raised the price target to $34 from the previous $27. The adjustment follows Harmony Biosciences' preannouncement of fourth-quarter Wakix sales and preliminary financial guidance for FY24, which aligned with consensus expectations but fell slightly short of Raymond James' estimates.
Harmony Biosciences concluded 2023 with approximately 6,150 patients using their drug, Wakix, and anticipates an increase to around 7,000 patients in 2024. The firm believes that Harmony Biosciences is likely to exceed these projections and adjust them upward throughout the year, noting that the growth in new patients each quarter has been steady at around 350.
The optimism for Harmony Biosciences' stock is partly due to potential upside from two key developments. Firstly, the company's efforts to expand the label for Wakix into treating Prader-Willi Syndrome (PWS), with Phase 3 trials expected to commence in the first quarter of 2024. Secondly, the upcoming data from trials of Zygel, a product acquired from Zynerba Pharmaceuticals (NASDAQ:ZYNE) for treating Fragile X Syndrome, which are anticipated to be released by the middle of next year.
After revising revenue and operating expense forecasts, Raymond James has increased its price target for Harmony Biosciences to reflect these developments and the consistent patient growth. The firm's outlook remains positive, with the expectation that Harmony Biosciences will continue to surpass conservative estimates and strengthen its financial performance.
InvestingPro Insights
Following the recent update from Raymond James, Harmony Biosciences Holdings Inc. (NASDAQ: HRMY) is capturing investor attention with several positive financial metrics and strategic moves. According to InvestingPro data, Harmony Biosciences boasts a market capitalization of $1.78 billion and has shown impressive revenue growth, with an increase of 35.22% over the last twelve months as of Q3 2023. This growth is further highlighted by the company's gross profit margin which stands at a robust 80.63% for the same period.
Investors may also find the company's valuation metrics compelling. The adjusted price-to-earnings (P/E) ratio as of Q3 2023 is 11.37, which may suggest an attractive valuation relative to earnings. Furthermore, the company's strong financial health is underscored by two InvestingPro Tips: Harmony Biosciences holds more cash than debt on its balance sheet and its liquid assets exceed short-term obligations, indicating a solid financial position that could support ongoing and future business initiatives.
For those looking to delve deeper into Harmony Biosciences' financial prospects, additional InvestingPro Tips reveal that management has been actively buying back shares and that analysts predict the company will be profitable this year. With a total of 7 additional tips available on InvestingPro, investors can gain a more comprehensive view of the company's potential by exploring these insights. To access these valuable tips and more, visit https://www.investing.com/pro/HRMY and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
Overall, the combination of strategic developments, strong financial performance, and positive analyst sentiment could position Harmony Biosciences favorably in the eyes of investors as the company continues to grow and expand its therapeutic offerings.
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