Mizuho Securities adjusted its price target for Apellis Pharmaceuticals (NASDAQ:APLS), a biopharmaceutical company, following a recent regulatory development in Europe. The firm's analyst has lowered the price target on the company's stock to $39.00, down from the previous target of $42.00, while maintaining a Neutral rating on the shares.
The revision comes in the wake of Apellis Pharmaceuticals' announcement that the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) has issued a final negative opinion on the potential European regulatory approval for pegcetacoplan, marketed as Syfovre in the United States. The analyst was not surprised by this outcome, having previously assessed the low probability of a positive opinion based on an analysis of past re-examinations by the EMA.
The reaffirmation of the negative opinion, which was initially received in July 2024, has led Mizuho Securities to exclude projected European Union-related revenue for Syfovre from their financial model. This exclusion has resulted in a 7% reduction in the price target for Apellis Pharmaceuticals.
The analyst cited a lack of visibility on potential catalysts that could significantly drive the stock price higher as a reason for maintaining the Neutral rating. The absence of EU-related Syfovre revenue in the model reflects the updated expectations for the company's financial performance following the CHMP's decision.
Apellis Pharmaceuticals has been the focus of various analyst firms due to its recent developments. Despite a setback in the EU, Stifel has maintained a Buy rating on Apellis, indicating the company's strong presence in the U.S. market.
Mizuho Securities, on the other hand, reduced its price target for Apellis to $39 while maintaining a Neutral rating, following a negative opinion from the European Medicines Agency's Committee for Medicinal Products for Human Use. Other firms such as BofA Securities, Baird, and Jefferies have also revised their price targets and ratings in response to these developments.
Apellis Pharmaceuticals reported strong Q2 2024 growth, with its drugs SYFOVRE and EMPAVELI generating considerable revenues. SYFOVRE achieved over $0.5 billion in sales since its launch and $155 million in net product revenue in Q2 2024 alone. EMPAVELI also contributed significantly with $24.5 million in sales.
Moreover, the company's drug pegcetacoplan, marketed as Empaveli, has shown positive results from the Phase 3 VALIANT study demonstrating a significant 68% reduction in proteinuria, a marker of kidney damage, in patients with two rare kidney diseases.
InvestingPro Insights
As investors digest the impact of the CHMP's decision on Apellis Pharmaceuticals (NASDAQ:APLS), real-time data from InvestingPro offers a broader perspective on the company's financial health and market performance. With a market capitalization of approximately $3.96 billion, Apellis is navigating a challenging period. The company's stock has experienced significant volatility, with a one-month price total return of -18.95%, highlighting the market's reaction to recent developments.
InvestingPro Tips suggest caution, noting that analysts do not expect the company to be profitable this year and have revised their earnings downwards for the upcoming period. This aligns with the company's current P/E ratio, which stands at a negative -11.69, reflecting investor concerns about future earnings. Additionally, Apellis operates with a moderate level of debt and is trading near its 52-week low, which could present a potential entry point for value-seeking investors. It's important to note that while the company's liquid assets exceed short-term obligations, it has not been profitable over the last twelve months, and it does not pay a dividend to shareholders.
For those considering investment opportunities, it's worth exploring the full suite of InvestingPro Tips, which currently lists over 10 additional insights for Apellis Pharmaceuticals. These tips can provide a deeper understanding of the company's prospects and help investors make more informed decisions. To access these insights, interested parties can visit InvestingPro's dedicated page for Apellis at https://www.investing.com/pro/APLS.
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