On Monday, Baird reaffirmed its positive stance on Coherus Biosciences (NASDAQ:CHRS) shares, maintaining an Outperform rating and a price target of $8.00. The firm addressed a recent supply hiccup for Coherus, noting a disruption in the availability of Udenyca, a biosimilar product offered by the company.
The issue stems from capacity limitations at the contract manufacturing organization (CMO) tasked with the fill-finish process, which were detailed in an 8-K filing after the market closed on Friday.
According to the filing, these constraints are expected to exhaust the current supply of Udenyca by mid-October. Coherus anticipates that the supply will be replenished in early November. Baird has adjusted its financial expectations for Coherus, reducing the fourth-quarter 2024 and full-year 2025/2026 Udenyca revenue estimates due to this supply disruption.
Despite the setback, Baird's evaluation of Coherus' prospects remains unchanged, with the $8.00 price target sustained. The firm views the manufacturing snag as a temporary obstacle rather than a long-term issue. The analyst from Baird expressed that although the situation is unfortunate, the overall impact does not alter the price target for Coherus Biosciences' shares.
The supply interruption comes at a time when Coherus is managing the production of Udenyca, a drug used to decrease the incidence of infection in patients with non-myeloid cancer. The company is now navigating through the manufacturing challenges to restore the supply as swiftly as possible.
Investors and market watchers will be keeping an eye on Coherus Biosciences as it works to overcome this production issue and meet the projected timeline for resuming Udenyca supply in early November.
In other recent news, Coherus BioSciences is facing a temporary supply disruption of its UDENYCA product line due to capacity constraints at its Contract Manufacturing Organization. The company anticipates that manufacturing will resume by mid-October with product availability projected to resume in early November.
Coherus has also recently sold the rights to Yusimry, a biosimilar to Humira, for $40 million. In terms of analyst notes, UBS downgraded Coherus from Buy to Neutral due to concerns over future revenue growth, while Baird maintained an Outperform rating but reduced the price target to $8.
TD Cowen has maintained its Buy rating, indicating confidence in the company's strategic direction. The company also entered into a significant agreement with Apotex Inc., securing an exclusive license to commercialize the cancer drug toripalimab in Canada. These are recent developments for Coherus BioSciences.
InvestingPro Insights
As Coherus Biosciences (NASDAQ:CHRS) navigates through its recent supply hiccup, real-time data and insights from InvestingPro provide a broader context for investors. The company's market capitalization stands at $129.03 million, reflecting its current valuation in the market.
Despite the challenges, analysts have shown a glimmer of optimism, with two analysts revising their earnings upwards for the upcoming period. This could indicate expectations of a potential rebound or mitigation of the current supply issues.
However, the company is not without its financial concerns. Coherus Biosciences is currently trading near its 52-week low and has experienced a significant price drop over the last year, with a one-year price total return of -73.58%. This downtrend in the stock price could be attributed to the company's performance over the last twelve months, where it was not profitable, as reflected in the adjusted P/E ratio of -38.82.
Moreover, the company's cash burn rate is a point of caution for investors, as noted in an InvestingPro Tip, suggesting that the company is quickly depleting its cash reserves.
Investors interested in a deeper analysis can find more InvestingPro Tips on Coherus Biosciences at https://www.investing.com/pro/CHRS, which provides further insight into the company's financial health and market performance. There are a total of 7 additional tips listed in InvestingPro that could help investors make more informed decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.