On Thursday, Mizuho Securities adjusted its price target for Axsome Therapeutics (NASDAQ:AXSM), a company focusing on central nervous system disorders, by a slight margin. The new price target is set at $109.00, up from the previous $108.00, while the firm continues to recommend a Buy rating on the stock.
The adjustment comes after the release of top-line Phase 3 data for AXS-12, Axsome's drug candidate for narcolepsy, earlier in the week. The study met its primary endpoint, which prompted Mizuho to reassess the drug's potential and slightly increase the price target based on model changes.
In addition to the data highlights, Mizuho's note included reflections on the drug's data and initial feedback from a key opinion leader in narcolepsy. Despite the positive outcome of the study, Mizuho remains cautiously optimistic about the drug's overall market potential.
Looking forward, Mizuho anticipates a significant data catalyst for Axsome later in the year. The second half of 2024 is expected to bring ADVANCE-2 data for AXS-05, another of Axsome's drug candidates, which is being developed for Alzheimer's agitation. This upcoming event is a factor in the firm's decision to maintain its Buy rating on Axsome Therapeutics shares.
InvestingPro Insights
Following Mizuho Securities' updated price target for Axsome Therapeutics, a closer look at the company's financial health and market performance through InvestingPro data and tips offers additional context for investors. Axsome's gross profit margin stands at an impressive 90.37% for the last twelve months as of Q1 2023, underscoring the company's ability to maintain profitability on its products. However, it's important to note that analysts do not expect Axsome to be profitable this year, which aligns with the firm's moderate level of debt and the fact that it has not been profitable over the last twelve months.
Despite these challenges, Axsome's liquid assets exceed its short-term obligations, suggesting a stable financial position in the near term. Moreover, the company's stock has seen a strong return over the last five years, which may interest long-term investors. With a market capitalization of $3.63 billion and a high Price / Book multiple of 19.64, Axsome is trading at a premium, reflecting the market's expectations of future growth spurred by its pipeline of drug candidates.
Investors interested in a deeper analysis can find additional InvestingPro Tips for Axsome, which provide further insights into the company's performance and potential. For those looking to enhance their investment strategy with comprehensive data and expert analysis, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro. There are six more InvestingPro Tips available, offering a broader perspective on Axsome's investment profile.
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