David Li, an analyst from Bank of America Securities, reiterated the Hold rating on BeiGene (BGNE – Research Report). The associated price target is $171.40.
David Li has given his Hold rating due to a combination of factors surrounding BeiGene’s financial performance and market position. BeiGene’s revenue showed a significant year-over-year increase, primarily driven by global sales of its product Brukinsa, and its total revenue growth was in line with Bank of America Securities’ estimates. Additionally, the company’s gross margin on product sales improved notably, thanks to the higher-margin contribution from Brukinsa compared to other licensed-in products. However, BeiGene also experienced substantial increases in research and development (R&D) and selling, general, and administrative (SG&A) expenses, reflecting its ongoing investment in pipeline development and global market expansion. Despite these expenses, the company managed to reduce its net loss significantly from the previous year. Li’s updated price objective reflects higher earnings estimates but maintains a Neutral rating due to the competitive environment and pricing pressures, especially in the China market.
Furthermore, David Li acknowledges the positive regulatory developments for BeiGene in global markets, such as the FDA’s approval of a label update for Brukinsa and the promising progress of Tislelizumab in the European market. These advancements, along with the anticipated approvals and submissions in various markets, act as key catalysts for the company’s growth trajectory. Despite these positive aspects, the Hold rating suggests that the potential benefits from these developments might be counterbalanced by the risks associated with increased competition and pricing pressures. The report indicates that while BeiGene is on track with its business development, these market dynamics could limit the stock’s upside potential, justifying the Hold rating rather than a more bullish stance.
In another report released yesterday, Bernstein also maintained a Hold rating on the stock with a $196.00 price target.
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BeiGene (BGNE) Company Description:
BeiGene, Ltd.is a biopharmaceutical company. The company primarily focuses on developing molecularly targeted and immuno-oncology drugs for the treatment of cancer.
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