On Thursday, Evercore ISI updated its financial outlook for Travere Therapeutics (NASDAQ:TVTX), increasing the price target to $33.00 from the previous figure of $30.00. This revision comes while the firm maintains an Outperform rating on the biopharmaceutical company’s stock.
The upgrade in the price target follows Travere Therapeutics' recent financial results, which showed Filspari sales surpassing expectations. The drug achieved sales of $35.6 million, which not only represents a 31% quarter-over-quarter growth but also a roughly 10% beat to the $32.9 million consensus.
The analyst noted that the number of 505(b)(2) start forms, which are used for the approval of new formulations of existing drugs, remained relatively flat this year. However, there is an expectation for a slight increase in the fourth quarter, potentially influenced by full approval and the drug's inclusion in the KDIGO (Kidney Disease: Improving Global Outcomes) guidelines. This anticipated rise is thought to be somewhat counterbalanced by the challenges of a burdensome REMS (Risk Evaluation and Mitigation Strategies) program.
Looking ahead, Evercore ISI forecasts $41 million in sales for Travere Therapeutics in the fourth quarter, which aligns with the consensus and indicates continued quarter-over-quarter growth. The upward adjustment of the price target to $33 is attributed to a refined outlook on the FSGS (focal segmental glomerulosclerosis) market opportunity and growing confidence in an approval anticipated to occur late in 2025.
In other recent news, Travere Therapeutics has been the focus of several analyst upgrades and adjustments. TD Cowen reaffirmed its Buy rating for Travere, following the PARASOL Project's findings on FSGS (Focal Segmental Glomerulosclerosis) treatment. Wells Fargo upgraded Travere's stock rating to Overweight and adjusted the company's valuation to $27 per share. Stifel also increased its price target for Travere to $13.00, reflecting the company's recent progress.
Travere's drug, Filspari, has shown significant benefits in reducing proteinuria in the DUPLEX study. The company is planning to discuss a potential supplemental New Drug Application (sNDA) for Filspari in treating FSGS with the FDA. Additionally, FILSPARI received temporary marketing authorization from Swissmedic for the treatment of adults with primary IgA nephropathy, following approvals from the U.S. Food and Drug Administration and the European Medicines Agency.
However, Travere has temporarily paused patient enrollment for the Phase III HARMONY study of pegtibatinase due to a manufacturing scale-up issue. Despite this, Travere reported a strong financial position, with $325.4 million in cash and securities, expected to support its operations into 2028.
InvestingPro Insights
Travere Therapeutics' recent financial performance and Evercore ISI's optimistic outlook are complemented by several key insights from InvestingPro. The company has demonstrated impressive growth, with revenue increasing by 47.42% over the last twelve months as of Q2 2024, and an even more substantial 68.08% growth in quarterly revenue. This aligns with the strong Filspari sales reported in the article.
However, investors should note that Travere is currently operating at a loss, with a negative gross profit margin of -31.44% and an operating income margin of -178.02% over the same period. This is reflected in two InvestingPro Tips: the company is "quickly burning through cash" and "not profitable over the last twelve months."
Despite these challenges, the market seems optimistic about Travere's future prospects. The stock has shown a strong return of 174% over the past year, and an impressive 221.07% return over the last six months. This positive sentiment is likely driven by the success of Filspari and the potential for future approvals, as mentioned in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Travere Therapeutics, providing a deeper understanding of the company's financial health and market position.
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