Jefferies ups Neurocrine Bio shares target, expects strong data from schizophrenia study

EditorEmilio Ghigini
Published 19-08-2024, 03:38 pm

On Monday, Jefferies updated its outlook for Neurocrine (NASDAQ:NBIX) Biosciences, Inc. (NASDAQ: NBIX) shares, raising the price target to $189.00 from the previous $177.00 while maintaining a Buy rating on the stock. The adjustment comes as the company anticipates data from its Phase 2 study of NBI-568, a treatment for Schizophrenia.

The analyst from Jefferies expressed optimism about the potential results of the NBI-568 study, indicating that the data could reveal efficacy comparable to Emraclidine with a 10 to 12 point placebo-adjusted reduction in PANSS scores, which measure the severity of Schizophrenia symptoms.

The anticipated success is attributed to several factors, including the drug's high selectivity for the M4 receptor, favorable biophysical properties, and effective brain exposure at dosages similar or slightly higher than once daily.

The firm's confidence in NBI-568's prospects is further reflected in their financial forecast, which includes a $1.8 billion risk-adjusted peak sales estimation in the Schizophrenia market.

This projection is based on the drug's potential to match or exceed the efficacy and safety profile of existing treatments, such as KarXT and Emraclidine, while offering a better safety profile.

The updated price target of $189.00 reflects the firm's revised expectations for the drug's market performance, signaling a positive outlook for Neurocrine Biosciences' financial future contingent upon the successful development and commercialization of NBI-568. The company's stock price may see an impact from this updated analysis as investors anticipate the forthcoming study results.

In other recent news, Neurocrine Biosciences has reported a robust second quarter in 2024, with a notable year-over-year growth of over 30% in sales of their drug, INGREZZA. This strong performance has led the company to raise their sales guidance for the year to a range of $2.25 billion to $2.3 billion.

In addition to this, Neurocrine Biosciences is awaiting FDA approval for Crinecerfont, a drug for congenital adrenal hyperplasia, which is expected by the end of the year.

The company is also investing in its sales force expansion and making advancements in its clinical pipeline in neuroscience, indicating a focus on sustained growth.

Among recent developments, Neurocrine Biosciences has not provided peak revenue guidance for INGREZZA, but expressed confidence in the drug's continued investment.

The company's strategic investments in drug development and market expansion are poised to support its objective of long-term growth in the field of neuroscience.

InvestingPro Insights

Neurocrine Biosciences (NASDAQ: NBIX) has been a subject of positive attention, with analysts revising their earnings upwards for the upcoming period, reflecting confidence in the company's financial prospects. This aligns with the recent price target update from Jefferies, as the company prepares for crucial data from its Phase 2 study of NBI-568. InvestingPro data highlights a robust revenue growth of 26.69% over the last twelve months as of Q2 2024, with a gross profit margin of 68.55%, underscoring the company's strong operational performance.

InvestingPro Tips suggest that NBIX is trading at a low P/E ratio relative to near-term earnings growth, indicating potential for value investment. Moreover, the company is expected to grow its net income this year, which may be a result of successful drug developments and market penetrations such as NBI-568. For investors seeking more detailed analysis, there are over 13 additional InvestingPro Tips available, which could provide further insights into the company's financial health and stock performance.

Lastly, with a market capitalization of $14.64 billion and a P/E ratio of 42.61, Neurocrine Biosciences stands as a significant player in the biotechnology sector. The company's stock has experienced a year-to-date price total return of 10.06%, showcasing its resilience and growth potential in a competitive market.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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