H.C. Wainwright analyst Emily Bodnar reiterated a Hold rating on NovoCure (NVCR – Research Report) today and set a price target of $20.00.
Geoff Meacham has given his Hold rating due to a combination of factors surrounding NovoCure’s recent strategic decisions and financial projections. The company has announced a prioritization of its pipeline, focusing on its glioblastoma (GBM) business and non-small cell lung cancer (NSCLC), which includes the preparation for commercial launch in second-line NSCLC. NovoCure is on track with its Phase 3 studies, with key data expected from the METIS and PANOVA-3 studies in 2024. However, the company is also reducing its workforce and de-prioritizing certain studies, such as those for locally advanced NSCLC, hepatocellular carcinoma, and gastric cancer, which could limit its growth potential in the near term.
The restructuring is expected to save approximately $60M, which will be utilized to fund the commercial launch efforts in second-line NSCLC and support ongoing and planned clinical studies. Despite these savings, the analyst anticipates that operating expenses will remain flat in 2024 compared to 2023. Additionally, the report suggests a conservative outlook for the company’s long-term growth, leading to a decrease in the price target to $20 from $25. This adjustment is mainly due to the narrowed focus of NovoCure’s research and development efforts and the postponement of new study initiations, ultimately affecting the expected profitability timeline and long-term growth rate.
According to TipRanks, Bodnar is an analyst with an average return of -9.1% and a 30.46% success rate. Bodnar covers the Healthcare sector, focusing on stocks such as Olema Pharmaceuticals, ACELYRIN, INC., and Gracell Biotechnologies.
In another report released on November 20, J.P. Morgan also initiated coverage with a Hold rating on the stock with a $15.00 price target.
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NovoCure (NVCR) Company Description:
NovoCure Ltd. develops treatment for tumors. Its platform is called the Tumor Treating Field which used electric fields tuned to specific frequencies to disrupt solid tumor cancer cell division. The company was founded by Yoram Palti in 2000 and is headquartered in St. Helier, Jersey.
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