Leerink Partners analyst Jonathan Chang has reiterated their bullish stance on NVCR stock, giving a Buy rating on November 28.
Jonathan Chang has given his Buy rating due to a combination of factors linked to NovoCure’s strategic restructuring and promising clinical trial readouts. The company has announced a plan to prioritize its portfolio and reduce operating expenses, which is expected to expedite its path to profitability. This plan includes a significant reduction in workforce and a narrowed operational focus on preparing for the launch of TTFields in non-small cell lung cancer (NSCLC), along with key Phase III study readouts and a few Phase II studies. Despite these changes, crucial Phase III trials such as METIS and PANOVA-3 are still on track, which reinforces the potential for positive developments in the near future.
Moreover, Chang’s confidence in NovoCure is buoyed by the anticipated $60 million reduction in operating expenses, which should be balanced by the costs of launch preparations in NSCLC and the initiation of planned studies. The management’s projection of a net flat cash burn for 2024 compared to 2023 and expectations of revenue impact from NSCLC by 2025 further supports a positive outlook. Chang’s valuation remains unchanged at a $38 price target, considering the base business in glioblastoma (GBM) and the probability-weighted sales in upcoming trials. The potential for revenue growth from NSCLC and the possibility of successful Phase III outcomes contribute to the Buy rating, suggesting an optimistic view of NovoCure relative to its current market valuation.
Chang covers the Healthcare sector, focusing on stocks such as Immatics, Revolution Medicines, and NovoCure. According to TipRanks, Chang has an average return of -15.9% and a 25.40% success rate on recommended stocks.
In another report released on November 28, Wells Fargo also maintained a Buy rating on the stock with a $49.00 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.
Read More on NVCR:
- Novocure to reduce workforce by 13% in strategic restructuring
- Boeing upgraded, Arm initiated: Wall Street’s top analyst calls
- Novocure reinstated with Neutral from Underweight at JPMorgan
- Novocure reports Q3 EPS (46c), consensus (52c)
- Novocure teams with Stanford to create TTFields research program
