On Wednesday, Orion Oyj (ORNBV:FH) (OTC: ORINY) received an updated stock rating from Jefferies, shifting from Underperform to Hold. The firm also increased the price target for the pharmaceutical company to €46.00, a significant rise from the previous €28.00.
The upgrade comes after a reassessment of Orion's Nubeqa product, which has shown recent outperformance and garnered positive feedback from doctors.
The firm's analysts now project that Nubeqa's peak sales will reach €750 million, an increase from the prior estimate of €450 million. This adjustment aligns with Bayer (OTC:BAYRY)'s guidance of achieving in-market peak sales of more than €3 billion before facing generic competition from Xtandi in 2028.
In addition to the Nubeqa sales forecast, Jefferies has factored in potential royalty income from opevesostat, a treatment in development with Merck. While Phase 3 data for opevesostat are not expected until 2026, the anticipated royalties could help to mitigate any decline in Nubeqa sales.
Orion's current valuation is trading at approximately 22 times the projected 2024 earnings per share (P/E), with an expected compound annual growth rate (CAGR) of 19% for earnings per share from 2024 to 2027.
This valuation is broadly consistent with the sector average. The revised price target of €46 reflects these considerations, leading to the decision to upgrade the stock to a Hold status.
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