On Monday, RBC (TSX:RY) Capital reaffirmed its positive outlook on Regeneron (NASDAQ:REGN) Pharmaceuticals, maintaining an Outperform rating and a $1,229.00 price target on the company's shares.
The firm's analysis suggests that the anticipated revenue increase from the collaboration with Sanofi (EPA:SASY) (NASDAQ:SNY) is not fully recognized by the market. RBC predicts that Regeneron's share of the collaboration revenue will exceed the consensus models by $1 billion, forecasting an additional $3 billion compared to the expected $2 billion.
The firm anticipates that this revenue surge, combined with product growth and pipeline advancements, will significantly enhance Regeneron's operating margins. Specifically, an improvement of nearly 8% in operating margins is expected between 2025 and 2027. Additionally, the firm projects a substantial 43% increase in earnings per share (EPS), equating to nearly $20 per share over the same period.
These financial improvements are projected to alter Regeneron's market valuation, potentially shifting it from its current position in line with its peers to a more favorable discounted valuation compared to other high-growth large biopharmaceutical companies.
"We continue to view REGN as one of the most attractive large-cap biotechs, with potential for further upside on any positive updates on dupi strength/COPD expansion, EyleaHD uptake, and pipeline progress," said analysts at RBC.
In other recent news, Regeneron Pharmaceuticals has been the focus of several key developments. TD (TSX:TD) Cowen maintained a Buy rating on Regeneron with a price target of $1,030, following discussions at its 2024 US Corporate Access Day. The company's obesity pipeline, the leptin agonist mibavademab, Eylea HD, Dupixent, and the severe allergy program were among the topics of interest.
Regeneron and its partner Sanofi received FDA approval for Kevzara, a treatment for children weighing at least 63 kilograms with active polyarticular juvenile idiopathic arthritis (pJIA). This approval expands the treatment landscape for pediatric patients with pJIA, offering a new option with a proven track record of efficacy and safety.
Despite a delay in the approval process for Dupixent by the FDA, BMO (TSX:BMO) Capital maintains an outperform rating on Regeneron, predicting Dupixent to generate $2.9 billion in sales for the treatment of COPD.
Piper Sandler maintained its Overweight rating on Regeneron, adjusting its fourth quarter 2024 earnings estimate for Regeneron's Eylea franchise downward due to potential short-term challenges. However, the firm remains optimistic about the long-term outlook for Eylea.
InvestingPro Insights
According to the latest data from InvestingPro, Regeneron Pharmaceuticals (NASDAQ:REGN) is demonstrating robust financial health and market performance. With a market capitalization of $113.62 billion and a current P/E ratio of 29.18, the company showcases stability and investor confidence. The revenue for the last twelve months as of Q1 2024 stands at $13.1 billion, indicating a growth of 5.9%, which aligns with RBC Capital's positive outlook on the company's revenue potential from the collaboration with Sanofi.
InvestingPro Tips reveal that Regeneron's management has been actively buying back shares, signaling confidence in the company's value. Additionally, the stock is currently trading near its 52-week high, reflecting strong market sentiment. With analysts predicting profitability this year and the company having been profitable over the last twelve months, Regeneron's financial trajectory appears to be on a solid upward path.
For readers interested in a deeper analysis and additional insights, there are 15 more InvestingPro Tips available for Regeneron, which can be accessed by visiting https://www.investing.com/pro/REGN. For those looking to subscribe to InvestingPro, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking a wealth of data and expert analysis to inform your investment decisions.
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