On Tuesday, Deutsche Bank increased its price target on UCB SA (UCB:BB) (OTC: UCBJY) shares to €200 from the prior €150, while maintaining a Buy rating on the stock. The firm's analyst highlighted UCB's first half results, which met all the key expectations.
The analyst noted that while the market has recognized the €4 billion+ potential of UCB's Bimzelx, it has not fully accounted for the possibility of it surpassing €5 billion. This underestimation overlooks the potential growth from upcoming launches in rheumatology and dermatology within the next 12 months.
UCB's recent performance suggests a promising future, with the analyst pointing out the company's reiteration of its 30%+ EBITDA target for the fiscal year 2025 and the possibility for margin leverage thereafter. The analyst's expectations include a mid-30s EBITDA percentage by the late decade, which is still considered a conservative estimate.
The analyst also expressed optimism about UCB's Rystiggo, which is seen to have blockbuster potential. Although there was some disappointment regarding the company's decision to abandon CIDP, the overall growth trajectory for UCB remains strong. Deutsche Bank forecasts a compound annual growth rate (CAGR) of 26% for EBITDA and 32% for EPS from 2024 to 2027, leading to a near doubling of EBITDA by 2028 and a significant revenue increase by the decade's end.
UCB's strategic focus on expanding its product offerings in key therapeutic areas, combined with sound financial targets, has positioned the company for robust growth. The updated price target reflects Deutsche Bank's confidence in UCB's ability to capitalize on these opportunities and deliver sustained financial performance.
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