On Tuesday, RBC Capital Markets adjusted its stock price target for Apellis Pharmaceuticals (NASDAQ:), increasing it to $26.00 from the previous $24.00, while maintaining a Sector Perform rating on the company’s shares. The stock has shown resilience with a 7.74% gain over the past week, trading at $34.38.
According to InvestingPro data, analyst targets for APLS range from $24 to $78, reflecting diverse views on the company’s prospects. The decision follows a detailed analysis of the market opportunities and challenges facing Apellis.
An analyst at RBC Capital, noted that the total addressable market (TAM) for geographic atrophy (GA), a focus area for Apellis, is expected to be smaller than that for wet age-related macular degeneration (wAMD).
Despite market limitations, InvestingPro data shows impressive revenue growth of 162.1% over the last twelve months, with analysts anticipating continued sales growth. This projection comes particularly after the negative outcome of the Committee for Medicinal Products for Human Use (CHMP) re-examination, which has seemingly limited Apellis’s market to the United States.
Another point of concern for Apellis is the potential loss of market share for its product, Syfovre, to its competitor Izervay. Key opinion leaders (KOLs) have expressed a preference for Izervay over Syfovre, citing safety as a deciding factor.
Despite this, Walter acknowledged Apellis’s success in the field of nephrology, a positive development for the company, although she also pointed out that the TAM in this segment is limited and the competition with Novartis (SIX:) (NVS) is significant.
Walter further mentioned that while Apellis has two approved drugs and is on a path toward near-term profitability, with an expected $1 billion top-line by 2026, the potential for mergers and acquisitions (M&A) has diminished, in her view.
The analyst recognized the company’s advancements in complement therapies and its strong management team. However, she concluded that due to the competitive challenges in the GA market, the current share valuation is appropriate.
In other recent news, Apellis Pharmaceuticals has been the subject of multiple analyst revisions and recent earnings results. Goldman Sachs downgraded Apellis from Buy to Neutral, citing a smaller than expected patient pool for the treatment of geographic atrophy with Apellis’ drug Syfovre.
Despite this, Apellis maintains a strong financial position and is expected to see impressive revenue growth, with analysts forecasting a 91% increase for FY2024.
In contrast, Morgan Stanley (NYSE:) initiated coverage on Apellis with an Equalweight rating, predicting over $600 million in revenue approximately two years post-launch of Syfovre. However, the firm also anticipates a deceleration in the growth pace in the Geographic Atrophy market.
On a similar note, Piper Sandler maintained its Neutral rating on Apellis shares, following a setback for competitor Astellas Pharma, which could potentially give Apellis’ Syfovre a competitive edge. Meanwhile, Baird reduced its price target for Apellis from $92 to $55, despite a 7% increase in commercial vial demand for SYFOVRE in the third quarter of 2024, resulting in net product revenues of $152 million.
Finally, Apellis reported positive Phase III results for EMPAVELI in treating C3 glomerulopathy and immunoglobulin M-associated membranoproliferative glomerulonephritis, with a supplemental New Drug Application (sNDA) submission expected in early 2025. These are the recent developments for Apellis Pharmaceuticals.
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