On Tuesday, Oxford Biomedica (OXB:LN) (OTC: OXBDF) shares received a new price target from Deutsche Bank. The target was increased to GBP3.80 from GBP2.50, while the firm maintained a Hold rating on the stock. The adjustment follows Oxford Biomedica's announcement of an 18% increase in sales, totaling £51 million. This growth was attributed to new client acquisitions in the UK and the input from the ABL acquisition, although it was partly offset by the termination of a significant contract in the US.
The company reported an operating EBITDA loss of £20 million, which reflects investments made in anticipation of higher demand in the second half of the year. Despite this loss, Oxford Biomedica ended the period with a strong net cash position of £42 million. The firm's revenue guidance for the fiscal year 2024 remains steady, with expectations ranging between £124 million and £136 million.
Oxford Biomedica's mid-term financial outlook appears promising, supported by a contracted order book valued at £94 million signed year-to-date and a backlog worth £120 million, which extends visibility into 2025. The company continues to project a low-double-digit operating EBITDA loss for the year, suggesting a potential return to profitability or at least a break-even status in the latter half of the year.
In light of these developments, Deutsche Bank has adjusted its revenue forecast for Oxford Biomedica for the fiscal year 2024 to £127 million, positioning it at the lower end of the company's provided guidance range. This new price target reflects the firm's cautious optimism regarding Oxford Biomedica's financial trajectory and the anticipated demand for its services in the cell and gene therapy sector.
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