January 24, 2017
By Alex Keown, BioSpace.com Breaking News Staff
NEW YORK – If you’re looking to get hold of your investments, analysts at Jeffries have tagged four biotech stocks that are “cheap enough to buy” and have a “large enough market cap to provide some safety.”
Although down slightly this morning at $59.93, the analysts are bullish on Illinois-based AbbVie . Although the majority of the company’s revenue is tied to the rheumatoid arthritis drug Humira, the drug has shown a strong track record of generating revenue. The drug faces increased competition from biosimilars, although the company is fighting in the courts to prevent their commercialization and protect its revenue stream. While the company is largely hinged on the fortunes of Humira, the Jeffries analysts said they set a price target of $90 for the stock, well above the Wall Street consensus of 69.75.
Shares of Amgen are down a bit this morning, trading at $150.86. The Jeffries analysts said leadership’s willingness to look at M&A activity to spur pipeline and revenue growth was a good sign. The company is coming off a strong quarterly report and the analysts predicted that growth will continue for Amgen. The analysts predicted strong growth from high cholesterol drug Repatha, as well as the multiple myeloma drug Kyprolis. Additionally, the analysts said Amgen “has one of the industry’s deepest biosimilar pipelines, which is expected to generate upward of $3 billion in annual sales in the years ahead.” The Jeffries analysts have a target price of $198 for shares of Amgen, higher than the Wall Street consensus of $181.73.
Although Gilead Sciences has seen falling revenue from its hepatitis C pipeline, the analysts at Jeffries saw strong revenue potential in the company’s HIV pipeline. “Positive bictegravir data in 2017 could also help reaffirm out-year HIV revenue sustainability prospects,” the analysts said. One thing that could also send Gilead Stock higher is if the company pulls the trigger on some kind of merger or acquisition. Gilead is sitting on a large amount of cash reserves that it could use to make some kinds of deals that would benefit investors. Shares of Gilead Sciences are currently trading at $70.15. The Jeffries analysts have a target price of $93 for the stock, slightly below the Wall Street consensus of $95.01.
Shares of Celgene are trading at $111.59. The company is coming off a series of deals struck at the end of 2016. Those deals, as well as the plethora of others it has struck, has provided Celgene with a robust partnership-pipeline. The analysts said the buddy system has provided less risk for Celgene and has the potential for several blockbuster drugs. Additionally, the company has its own drugs, including cancer drugs Revlimid and Abraxane, which are generating strong revenue streams. The company also has four Phase III programs that have the potential to be strong revenue drivers if they meet endpoints, the analysts said. The Jeffries analysts set a target price of $142 for Celgene, above Wall Street consensus price of $138.29.
