Regeneron Pharmaceuticals Tops Profit Estimates; Stock Has Over 30% Upside Potential

Westchester County, New York-based biotechnology company, Regeneron reported better-than-expected profit in the fourth quarter, largely driven by a rebound in demand for its eye drug, sending its shares up over 3% on Friday.

Regeneron said its fourth-quarter 2020 revenues increased 30% to $2.42 billion and GAAP diluted EPS was $10.24 per share and non-GAAP diluted EPS was $9.53 per share. That was higher than the Wall Street consensus estimate of $8.23 per share.

Following this upbeat result, Regeneron shares, which surged over 28% in 2020, rose as much as 3.2% to $514.97 on Friday.

Executive Comments

“In 2021, in addition to our ongoing work on COVID-19, we expect further diversified growth driven by continued EYLEA momentum, expanded approvals and increased market penetration for Dupixent, and new launches for Libtayo in oncology. We anticipate U.S. regulatory action for Libtayo in both non-small cell lung cancer and basal cell carcinoma within the next month – and anticipate additional readouts later this year from across our oncology pipeline, including the bispecific platform,” said Leonard S. Schleifer, M.D., Ph.D., President and Chief Executive Officer of Regeneron.

Regeneron Stock Price Forecast

Fourteen analysts who offered stock ratings for Regeneron in the last three months forecast the average price in 12 months at $673.55 with a high forecast of $793.00 and a low forecast of $553.00.

The average price target represents a 32.63% increase from the last price of $507.86. From those 14 analysts, 11 rated “Buy”, three rated “Hold”, and none rate “Sell”, according to Tipranks.

Morgan Stanley gave a base target price of $553 with a high of $975 under a bull scenario and $407 under the worst-case scenario. The firm currently has an “Equal-weight” rating on the biotechnology company’s stock.

“We are Equal-weight Regeneron as we believe potential upside factors such as success from Libtayo in NSCLC and the early stage bi-specific pipeline, is offset by potential risks from international reference pricing and pressures to Eylea,” said Matthew Harrison, equity analyst at Morgan Stanley.

Several other analysts have also recently commented on the stock. Credit Suisse raised the price target to $758 from $736. Citigroup upped the price objective to $584 from $575. Benchmark upgraded stock’s rating to buy from hold and set $590 price target. BofA Global Research lowered price objective to $595 from $625. Bernstein cut price target to $600 from $700.

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