Share price estimates
Regeneron Pharmaceuticals (REGN) is based in Tarrytown, New York. It’s a leading biotechnology company. It focuses on developing innovative drugs for serious life-threatening diseases. Its main focus is on cancer, eye diseases, allergies, pain, and cardiovascular diseases.
According to Regeneron’s news release, it will report its earnings for 4Q15 and fiscal 2015 on February 9, 2016. It will report the earnings before the financial markets open in the US.
The above table shows 20 brokerage firms and the estimated target price for Regeneron. The consensus 12-month target price for Regeneron is $624.28 with a horizon of 12 months. This translates to an ~29.3% return compared to Regeneron’s closing price of $482.99 on January 22, 2016.
According to Bloomberg’s consensus of 25 brokerage firms, recorded on January 22, 2016, 56.0% of the brokerage firms rated Regeneron as “buy,” while 44% broker firms rated the company as “hold.” None of the brokerage firms issued a “sell” rating for the stock.
Regeneron’s performance in 3Q15
Regeneron released the earnings for 3Q15 on November 4, 2015. The company reported 56.72% YoY (year-over-year) growth in revenue for 3Q15. Compared to the quarter-over-quarter performance, the sales growth in 3Q15 was ~13.90%. For the first nine months of 2015, it experienced ~49% revenue growth compared to the same period in 2014.
The above graph shows the movement in Regeneron’s share price over two years.
Share price movement
Following impressive earnings data, Regeneron’s stock price rose to $587 in the second half of November 2015. The growth came from Eylea. Eylea registered 65% YoY growth during 3Q15. The net product sales for the drug rose to $734.4 million during 3Q15 compared to $445 million reported in 3Q14. Regeneron received approval for Eylea in the US in 2011 to treat neovascular age-related macular degeneration or wet AMD. The drug was gradually approved for the indication of macular edema following central retinal vein occlusion, DME (diabetic macular edema), macular edema following retinal vein occlusion, and diabetic retinopathy in patients with DME.
Avastin is one of Eylea’s competitors. It’s an off-label drug used in AMD patients. Competitors like Amgen (AMGN) and Pfizer (PFE) are developing biosimilar for Avastin. Avastin is jointly developed by Roche (RHHBY) and Genentech.
To diversify the risk of investing directly in Regeneron equity, investors can look for options like the iShares Nasdaq Biotechnology ETF (IBB). IBB has 6.8% of its total holdings in Regeneron.