On Tuesday, Mizuho (NYSE:MFG) Securities sustained its positive stance on ADMA Biologics (NASDAQ:ADMA), reaffirming an Outperform rating and a $24.00 price target for the company's stock. This affirmation comes despite ADMA Biologics' shares experiencing a 15% decline over the last two trading days, which occurred with little direct news to justify the sell-off. According to InvestingPro data, while the stock has dropped 9.76% in the past week, it maintains an impressive 416.8% return over the last year, with a robust financial health score rated as "GREAT."
The decline in ADMA's stock has prompted discussions among investors, focusing on several factors. These include the recently announced termination of transaction negotiations between Grifols (BME:GRLS) and Brookfield Capital Partners (WA:CPAP) on November 27, concerns regarding the potential impact of upcoming US policy changes on plasma collection volumes at the US-Mexico border, and the possibility of delayed selling pressure following recent changes to ADMA's Board of Directors. For deeper insights into ADMA's market position, InvestingPro subscribers can access comprehensive analysis, including 15+ additional ProTips and detailed valuation metrics.
Mizuho's analyst believes that the concerns raised are exaggerated and maintains a positive outlook for ADMA Biologics. The analyst highlighted that the situation with Grifols could be beneficial for ADMA's plasma supply narrative. The firm's outlook remains optimistic, with the expectation that 2025 will be another transformative year for the company.
The analyst also encouraged investors to see the recent drop in ADMA's stock price as an opportunity, likening it to a "Cyber Monday stock sale." Mizuho continues to recommend ADMA Biologics as a top pick for investors, with confidence in the company's strategy to expand the supply of RSV plasma.
In other recent news, ADMA Biologics has reported significant growth in its third-quarter earnings for 2024. Total (EPA:TTEF) revenues reached $119.8 million, a 78% increase compared to the previous year, and net income surged by 1,300% to $35.9 million. The company has revised its financial guidance upwards, projecting revenues of over $415 million for 2024 and $465 million for 2025. Adjusted EBITDA is expected to exceed $160 million in 2024 and reach $215 million in 2025, driven by anticipated growth of its product ASCENIV and initiatives to enhance production and donor retention.
In terms of organizational changes, ADMA Biologics announced board adjustments including the resignation of Bryant E. Fong and the appointment of Young T. Kwon, PhD, as the new Chairman of the Audit Committee. Steven A. Elms joined the Audit Committee while Alison C. Finger joined the Governance and Nominations Committee and the Compensation Committee. These changes reflect the company's commitment to strong corporate governance and oversight.
Mizuho Securities maintained its Outperform rating for ADMA Biologics, following investor meetings with CEO Adam Grossman and Senior Director of Business Development & Strategy, Skyler Bloom. The company is also progressing with its initiatives to improve immunoglobulin yields, with implementation expected in the second half of 2025. However, the company anticipates a sequential revenue decline in Q4 due to a one-time plasma sale. Despite this, ADMA Biologics remains optimistic about its future growth, particularly from ASCENIV, which is expected to drive margin expansion and earnings growth.
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