Ascendis Pharma (ASND) -4.2%) Suddenly falls probably in reaction to the Dovish biotech earnings report that got the wall Street analysts took off to lower their price target from SKYTROFA’s cautious outlook.
The company’s SKYTROFA is an FDA-approved weekly injection for human growth hormone deficiency.
Wells Fargo analyst Derek Archilla lowered the company’s price target on Ascendis to $176 from $190 in a research note released Thursday, with an overweight rating unchanged.
Archilla said Ascendis posted SKYTROFA revenue of 1.9 million euros in the first quarter, about half of consensus. This is consistent with its thesis that the launch of SKYTROFA will be slow.
Stocks have been weak and, Archila thinks, sufficiently account for the more conservative assumptions about SKYTOFA’s ramp-up in sales, but certainly don’t attribute enough value to TransCon PTH, which is the main driver of his thesis at more long term on the stock.
On March 13, the company announced early data from its Phase 3 trial of TransCon PTH in adults with hypoparathyroidism. In the first quarter earnings report, Archilla said TransCon PTH US FDA regulatory submission on track for Q3 and EU MAA for Q4 2022.
Total turnover for the quarter amounted to €6.83 million (+875.7% Y/Y). In net income, GAAP EPS of -€2.21 consensus missed by €0.05.
Credit Suisse also lowered its target on ASND to $123 from $194, while Cantor Fitzgerald sees it at $180, down from the previous price target of $230.
Oppenheimer analyst Leland Gershell cut his price target to $154 from $166, citing the same SKYTROFA selling below consensus. Gershell expects sales in future quarters to more closely track Street’s full-year forecast of $38 million.
However, the analyst is “encouraged” by other business metrics and notes the longer conversion time for switch patients, who form the majority of early adopters.
Citi analyst David Lebowitz said: “As expected, little information about the launch of Skytrofa emerged during the first quarter earnings report. Given that Street was hoping for visibility, this could lead to continued weakness in equities.” This concludes Citi’s price target reduction to $158 on Ascendis from $187 previously.
Overall, the ratings summary saw a strong buy from Wall Street and SA authors, while the Seeking Alpha Quant rating system gave a Hold.