On Tuesday, UBS has adjusted its price target on BridgeBio Pharma (NASDAQ:BBIO) shares, now aiming for a $47.00 target, a decrease from the previous $51.00.
Despite this change, the firm continues to recommend a Buy rating for the stock. The revision comes ahead of BridgeBio Pharma's upcoming release of phase 2, 18-month data update for its achondroplasia treatment, expected in early June.
BridgeBio Pharma, which trades on NASDAQ:BBIO, is anticipated to present both 12-month and 18-month data following the last update from its phase 2 Cohort 5 study at ENDO 2023.
During that event, the company reported a change from baseline in annualized growth velocity (AGV) of +3.38cm/year with its oral infigratinib treatment.
Investors are keenly awaiting the new data, as it could significantly influence the company's stock movement. An increase in AGV greater than +2.5cm/year could potentially lead to a notable rise in BridgeBio's share price, estimated between 10% to 30%.
Conversely, if the AGV increase is less than +2cm/year but still exceeds the +1.35cm/year from competitor BioMarin Pharmaceutical (NASDAQ:BMRN)'s phase 3 study, BridgeBio's stock could see a decline of approximately 10% to 20%.
The impact on BioMarin Pharmaceutical's shares, in light of BridgeBio's upcoming data, is also a subject of speculation. In a scenario where BridgeBio reports a significant AGV increase, BioMarin's stock might drop by around 5% to 15%.
If BridgeBio's AGV increase is modest, BioMarin's stock could either decrease by 5% or potentially gain up to 10%, depending on the specifics of the data released.
InvestingPro Insights
As BridgeBio Pharma (NASDAQ:BBIO) approaches its critical data update for its achondroplasia treatment, investors should note that analysts are anticipating sales growth for the current year, which could be a positive driver for the stock. With two analysts revising their earnings upwards for the upcoming period, the market sentiment appears to be cautiously optimistic. Despite analysts not expecting the company to be profitable this year, BridgeBio's high return over the last year, with a 103.2% price total return, suggests that the stock has been rewarding for investors who held it over this period.
InvestingPro data shows that BridgeBio Pharma has a market cap of $5.23 billion and a significant revenue growth of 181.05% over the last twelve months as of Q1 2024. The company's gross profit margin stands at an impressive 98.91% for the same period. However, with a negative P/E ratio of -8.73 and an adjusted P/E ratio of -9.85, the valuation reflects the market's concerns about profitability.
For those interested in deeper analysis and additional InvestingPro Tips, there are more insights available on BridgeBio Pharma, including the company's liquidity position and valuation multiples. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and discover the full range of expert tips and data to inform your investment decisions.
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