Mizuho Securities Lowers Price Target for Apellis Pharmaceuticals After EU Regulatory Development
Mizuho Securities has adjusted its price target for Apellis Pharmaceuticals (NASDAQ: APLS) following a recent regulatory development in Europe. The firm's analyst has decreased the price target on the company's stock to $39.00 from $42.00, while maintaining a Neutral rating on the shares.
The revision comes after Apellis Pharmaceuticals announced that the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) issued a final negative opinion on the potential European regulatory approval for pegcetacoplan, marketed as Syfovre in the United States. Mizuho Securities had anticipated this outcome due to the low probability of a positive opinion based on past re-examinations by the EMA.
The reaffirmation of the negative opinion, initially received in July 2024, has led Mizuho Securities to exclude projected European Union-related revenue for Syfovre from their financial model. This exclusion caused a 7% reduction in the price target for Apellis Pharmaceuticals.
The analyst cited a lack of visibility on potential catalysts to 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 post the CHMP's decision.
Despite the setback in the EU, Stifel has upheld a Buy rating on Apellis Pharmaceuticals, highlighting the company's strong presence in the U.S. market. Other firms like BofA Securities, Baird, and Jefferies have also adjusted their price targets and ratings in response to these developments.
Apellis Pharmaceuticals reported strong growth in Q2 2024, with its drugs SYFOVRE and EMPAVELI generating significant revenues. SYFOVRE achieved over $0.5 billion in sales since its launch, with $155 million in net product revenue in Q2 2024 alone. EMPAVELI also contributed with $24.5 million in sales.
Furthermore, pegcetacoplan, marketed as Empaveli, showed positive results from the Phase 3 VALIANT study, demonstrating a 68% reduction in proteinuria, a marker of kidney damage, in patients with rare kidney diseases.
InvestingPro Insights:
Investors should consider the impact of the CHMP's decision on Apellis Pharmaceuticals (NASDAQ: APLS) and review real-time data from InvestingPro for a comprehensive view of the company's financial health and market performance. With a market capitalization of around $3.96 billion, Apellis is facing a challenging period with significant stock volatility and a one-month price total return of -18.95%.
InvestingPro Tips advise caution as analysts do not expect the company to be profitable this year and have revised earnings downwards. The current negative P/E ratio suggests investor concerns about future earnings. Apellis operates with moderate debt and is trading near its 52-week low, potentially offering value-seeking investors an entry point. While the company's liquid assets exceed short-term obligations, it has not been profitable in the last twelve months and does not pay dividends.
For potential investors, exploring InvestingPro's full suite of Tips can provide valuable insights into Apellis Pharmaceuticals' prospects and help make informed decisions. Visit InvestingPro's dedicated page for Apellis for more insights.
In summary, Apellis Pharmaceuticals faces challenges in the EU regulatory environment, impacting its financial performance and stock price. Investors should be cautious and consider the company's current position and future prospects before making investment decisions.