Research analysts at Robert W. Baird have adjusted their price target for Ultragenyx Pharmaceutical (NASDAQ: RARE) from $72.00 to $47.00, reflecting ongoing shifts in market sentiment. This change, communicated in a research note on November 24, 2023, maintains an “outperform” rating on the biopharmaceutical company’s stock, indicating a potential upside of approximately 108.94% based on its previous closing price.
This revision forms part of a broader trend among equity research analysts. On the same day, Barclays reduced its price target from $81.00 to $50.00 while maintaining an “overweight” rating. Similarly, Wells Fargo & Company lowered its target from $65.00 to $45.00, also issuing an “overweight” rating. In a separate report, TD Cowen set a target price at $75.00 after lowering it from $86.00, while Leerink Partners adjusted its price objective from $80.00 to $70.00, keeping an “outperform” rating intact.
Market analysts have shown a mixed outlook for Ultragenyx, with fifteen analysts rating the stock as a Buy, one as a Hold, and one as a Sell. According to data from MarketBeat.com, the consensus rating stands at “Moderate Buy” with an average target price of $75.19.
Financial Performance and Market Reactions
On November 4, 2023, Ultragenyx released its latest earnings report, revealing a loss of ($1.81) earnings per share (EPS) for the quarter, which fell short of analysts’ estimates of ($1.23) by ($0.58). The company reported revenues of $159.93 million, which also missed expectations of $167.42 million. Year-over-year, revenues grew by 14.6%, but the company’s negative return on equity reached 414.17%, with a net margin of 91.95%.
Insider trading activity has also captured attention, particularly that of Chief Financial Officer Howard Horn, who sold 7,942 shares on October 13, 2023, at an average price of $31.51, totaling around $250,252.42. Following this transaction, Horn retained 98,227 shares, valued at approximately $3,095,132.77. Insiders currently hold 5.50% of the company’s stock.
Institutional Investments and Market Sentiment
Recent shifts in institutional investments have been noteworthy. Parallel Advisors LLC increased its holdings in Ultragenyx by 1,061.9% during the second quarter, acquiring an additional 669 shares. Assetmark Inc. also significantly boosted its stake by 1,706.7% in the third quarter, bringing its total to 1,084 shares. Other firms, such as Huntington National Bank and Danske Bank A S, have similarly increased their positions, highlighting a trend of growing institutional interest.
Despite the downward revisions from some analysts, positive sentiment persists. For instance, Jefferies reduced its target from $114 to $63 but maintained a “Buy” rating. This suggests that certain firms still see potential value in Ultragenyx, indicating a possible rebound in the future.
Conversely, the company faced significant setbacks with the failure of its Phase 3 trials for the Orbit and Cosmic studies, which did not meet their primary endpoints. This result has had immediate negative impacts, leading to sharp declines in share price and a trading halt as investors reacted to the news. Following the announcement, Ultragenyx indicated plans for “significant” cutbacks, which may help reduce short-term expenses but could also delay other ongoing projects.
Founded in 2010 and headquartered in Novato, California, Ultragenyx Pharmaceutical focuses on developing therapies for rare and ultra-rare genetic disorders. The company has built its reputation through innovative approaches, including protein replacement therapies and gene therapy. Its commercial portfolio includes notable products such as Crysvita for X-linked hypophosphatemia and Mepsevii for mucopolysaccharidosis VII.
As the market continues to evolve, shareholders and analysts will closely monitor Ultragenyx’s next moves in response to recent challenges and opportunities.
