On Friday, H.C. Wainwright adjusted its outlook on argenx SE (NASDAQ:ARGX), a biotechnology company, by lowering its price target slightly from $451.00 to $448.00. Despite the reduction, the firm has maintained a Buy rating on the stock. The move follows argenx's first-quarter earnings report, which showed net product sales of $398 million, marking a 6% quarter-over-quarter increase. The sales figure was marginally higher than the consensus estimate of $391 million.
The analyst from H.C. Wainwright noted that argenx's performance in the first quarter was solid and that there remains significant potential for growth in the treatment of Myasthenia Gravis (MG), a rare neuromuscular disease. However, it was acknowledged that the next phase of growth for argenx might materialize more gradually than previously expected.
Vyvgart, argenx's product, had the strongest launch in the industry in recent years, leading to high expectations among investors for continued outperformance. However, the latest sales figures did not exceed consensus estimates by a large margin, which was a departure from the trend of "big beats" against consensus that investors had become accustomed to.
The analyst pointed out that seasonality, particularly related to insurance resets, likely influenced the growth trajectory of Vyvgart. Given that Vyvgart has been on the U.S. market for two years, it is believed to be transitioning into the next stage of its lifecycle.
Despite the slight decrease in the price target, H.C. Wainwright expressed a belief that long-term investors would see substantial rewards, although near-term numbers might not show as much "upside" as in the past.
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