Alkermes (ALKS) PT Raised to $70 at Credit Suisse

October 21, 2016 9:29 AM EDT
Get Alerts ALKS Hot Sheet
Price: $55.47 -0.5%

Rating Summary:
    9 Buy, 6 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 21 | Down: 36 | New: 11
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Credit Suisse analyst Vamil Divan reiterated an Outperform rating and raised its price target on Alkermes (NASDAQ: ALKS) to $70.00 (from $52.00) after the company released positive data after the close from the third Phase 3 study for their pipeline anti-depression drug ALKS-5461.

Divan commented, "We had removed the product from our model after the first two Phase 3 studies failed but, given the positive results, we now add it back in with a 60% probability of success. We assume a peak sales potential of $1.2Bn given the unmet need in treatment-resistant depression, leading to probability-adjusted sales of $750MM in our model in 2023. After incorporating expected additional expenses that we believe would be necessary to successfully commercialize the asset, our DCF for ALKS increases to $71. Our blended 12-month target price increases to $70 (from $52) and is 75% driven by the $71 DCF while incorporating a 25% component of relative valuation ($67, based off a 3.5x multiple of our assumed total company peak sales of ~$3Bn). Our 2017-2019 EPS estimates come down modestly given the additional expense we are now adding into the model."

For an analyst ratings summary and ratings history on Alkermes click here. For more ratings news on Alkermes click here.

Shares of Alkermes closed at $43.51 yesterday.



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