On Thursday, Truist Securities updated its outlook on argenx SE (NASDAQ: ARGX), increasing the stock's price target to $660 from the previous $540 while maintaining a Buy rating. The adjustment follows argenx's reported third-quarter performance, which marked the 11th consecutive quarter-over-quarter growth, with net sales reaching $573 million. This figure surpassed both Truist Securities' projection of $529 million and the Street's expectation of $514 million.
The company's revenue sources were not specified by treatment indication, but the steady growth in myasthenia gravis (MG) treatments and over 300 chronic inflammatory demyelinating polyneuropathy (CIDP) patients receiving treatment in the third quarter were highlighted. Truist Securities estimates that CIDP treatments contributed approximately $30 to $50 million to the third-quarter revenues.
Argenx concluded the third quarter with a strong cash position of $3.4 billion. The firm is on track to reach a break-even point, with a projected revenue run rate of over $2 billion and operational expenses around the same figure for 2024. Consequently, argenx has suspended its cash guidance as it is no longer applicable.
The analyst from Truist Securities emphasized argenx's position in the industry, stating that the company boasts the most enviable immunology and inflammation (I&I) pipeline. Multiple data read-outs are expected from this pipeline in the next 12 to 18 months. This optimistic outlook on the company's innovative potential and financial performance has led to the raised price target and the reaffirmation of the Buy rating.
In other recent news, argenx SE demonstrated a strong financial performance, exceeding expectations with a third-quarter revenue of $573 million, primarily due to growth in Myasthenia Gravis treatments and the successful launch of the Chronic Inflammatory Demyelinating Polyneuropathy product.
This robust performance led Stifel to raise its price target on argenx to $707. In contrast, Deutsche Bank downgraded argenx stock from Buy to Hold after reviewing Phase 3 ADHERE data crucial for the company's current CIDP launch, expressing more caution than optimism.
Meanwhile, Raymond James resumed coverage on argenx stock, assigning a Strong Buy rating and a new price target of $605.00 following the recent success in obtaining approval for their CIDP treatment. In addition, Piper Sandler reiterated an Overweight rating on argenx stock, expressing confidence in Vyvgart's potential, even amidst potential competition from Amgen (NASDAQ:AMGN)'s Uplizna.
Argenx also reported significant progress in its product development pipeline, including plans for a confirmatory study in the United States for its Immune Thrombocytopenia treatment, and the recent approval and preparation for the launch of its CIDP product. These are the latest developments in the company's ongoing efforts to expand its therapeutic offerings.
InvestingPro Insights
Argenx SE's strong financial performance and promising pipeline, as highlighted in the article, are further supported by recent InvestingPro data and tips. The company's revenue growth has been remarkable, with a 98.69% increase over the last twelve months as of Q2 2024, and a 74.15% quarterly growth in Q2 2024. This aligns with the article's mention of 11 consecutive quarters of growth and the impressive Q3 net sales of $573 million.
An InvestingPro Tip indicates that argenx "holds more cash than debt on its balance sheet," which corroborates the article's statement about the company's strong cash position of $3.4 billion. This solid financial footing is crucial as argenx approaches its break-even point.
Another relevant InvestingPro Tip suggests that the stock is "trading near its 52-week high," with the price at 99.18% of its 52-week high. This reflects the market's positive sentiment towards argenx's performance and future prospects, as outlined in the Truist Securities analysis.
For investors seeking a deeper understanding of argenx's potential, InvestingPro offers 10 additional tips, providing a comprehensive view of the company's financial health and market position.
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