Vertex Pharma (VRTX): Cutting Ests But Maintaining Rating And PT After Orkambi Cut - Stifel
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Stifel analyst, Adam Walsh, reiterated his Buy rating on shares of Vertex (NASDAQ: VRTX) after the company received FDA approval for Orkambi in patients ages 6 to 11 (2,400 new patients) but also cut guidance on a slower than expected ramp.
The approval was widely expected, already included in management’s FY16 Orkambi guidance and baked into sellside models. However, management also lowered Orkambi guidance for 3Q16 and FY16, which is not altogether surprising on the heels of management’s cautious comments at a recent investor conference.
The analyst had cut his numbers at that time in anticipation of a soft quarter but this guidance prompts him to further trim 3Q16 and FY16 Orkambi estimates by $16M and $18M, respectively. He is maintaining Orkambi numbers in FY17 and beyond.
He continues to expect a 4Q16 announcement on the P1 triple combo data and P2 trial design to support shares near term, assuming positive P1 outcome. VX-661 data from three P3 trials in 1H17 represents additional potential drivers
No change to the price target of $109.
Shares of Vertex closed at $88.84 yesterday.
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