On Thursday, Wolfe Research began coverage of Roivant Sciences (NASDAQ:ROIV), a biopharmaceutical company, with an Outperform rating and a price target of $17.00. The firm highlighted Roivant's performance over the past year, which was bolstered by the sale of Televant to Roche (LON:0QQ6), and pointed to the company's strong financial position.
Roivant Sciences is noted for its substantial cash reserves, totaling nearly $7 billion, and its minimal debt load. Wolfe Research emphasized that Roivant's stock is currently trading at what they consider a negative enterprise value (EV) of approximately $1 billion when excluding its 57% stake in Immunovant (NASDAQ:IMVT). The firm suggests that this valuation implies a level of downside protection for investors.
Looking ahead, Wolfe Research indicated that Roivant Sciences is poised for potential positive developments with two of its programs, Priovant and Kinevant, expected to mature in 2024. Additionally, the anticipated progress of Immunovant is projected to contribute positively to Roivant's stock performance.
The analyst's commentary underscores the view that Roivant Sciences is well-positioned for future surprises that could tilt the scale toward the upside. The company's robust balance sheet and the potential growth of its biopharmaceutical programs are key factors in Wolfe Research's positive outlook on the stock.
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