Daily Update - March 14, 2023

Selected highlights of the day

By: Matthew Otto

FRC

  • Analyst Terry McEvoy from Stephens & Co. reiterates his Overweight rating on First Republic Bank  and a price target of $140.

ACAD

Acadia Pharmaceuticals has announced last week that the FDA has approved DAYBUE (trofinetide) for the treatment of Rett syndrome in adult and pediatric patients two years of age and older, making it the first and only drug approved for the treatment of Rett syndrome. DAYBUE is expected to be available in the US by the end of April 2023. Rett syndrome is a complex, rare, neurodevelopmental disorder typically caused by a genetic mutation on the MECP2 gene, which affects 6,000 to 9,000 patients in the US. The approval was supported by results from the pivotal Phase 3 LAVENDER study evaluating the efficacy and safety of trofinetide versus placebo in 187 female patients with Rett syndrome..

  • Morgan Stanley’s Jeffrey Hung maintaining a rating of Equal-Weight and increasing the price target from $19 to $20.
  • RBC Capital’s Gregory Renza has reiterated his Outperform rating and kept the price target at $27.
  • Canaccord Genuity’s Sumant Kulkarni maintains a Buy rating and has raised the price target from $24 to $26.
  • Charles Duncan of Cantor Fitzgerald has also maintained a rating of Overweight and increased the price target from $28 to $33.
  • Citigroup’s Neena Bitritto-Garg maintains a Neutral rating and has raised the price target from $19.4 to $21.
  • HC Wainwright & Co.’s Andrew Fein has maintained a Buy rating and raised the price target from $25 to $28.
  • Yesterday Mizuho’s Uy Ear reiterated a Neutral rating and maintained a price target of $19.

Uber wins appeal in California

Ride-sharing companies Uber and Lyft, and order delivery firm Doordash received positive news following a California appeals court ruling allowing them to classify their drivers as independent contractors. The decision overturned a lower court ruling that had prevented the companies from doing so.

GitLab reported Q4 revenue of $122.9 million

Beating analysts’ estimates of $119.6 million. The company also reported an adjusted loss of 3 cents per share, better than the expected loss of 14 cents per share. However, its full-year revenue guidance fell short of expectations. GitLab expects an adjusted loss of 14 cents to 15 cents per share on $117 million to $118 million in revenue for Q1 2023, below analysts’ estimates. For the 2024 fiscal year, the company sees an adjusted loss of 24 cents to 29 cents per share and $529 million to $533 million in revenue, which implies 25% growth at the middle of the range.

  • Truist Securities’ Miller Jump lowered his price targets from $65 to $50 while maintaining their Buy rating.
  • Goldman Sachs’ Alexander Blostein lowered their price targets from $75 to $65while maintaining their Buy rating.
  • RBC Capital’s Matthew Hedberg lowered his price target from $60 to $45 while having an Outperform rating.
  • Piper Sandler’s Rob Owens lowered his price target from $58 to $50 while keeping an Overweight rating.

Match gets upgraded

  • Barclays analyst Mario Lu has upgraded Match Group from Equal-Weight to Overweight and has set a price target of $52. He believes that the Tinder parent company is now a value stock and sees potential upside for the company’s paid user base and increased monetization efforts.

Amylyx Pharmaceuticals

Has reported its Q4 and full-year 2022 financial results, indicating product revenue of $22.2m for the year. The company’s commercial launches of RELYVRIO in the US and ALBRIOZA in Canada continued to progress. The regulatory review is ongoing in the EU. Amylyx appointed Karen Firestone, CEO and co-founder of Aureus Asset Management and prior fund manager at Fidelity Investments, to its board of directors, effective March 16. Despite exciting advancements, the company has indicated that there is still work to do to meet its goal of quick and efficient access for every eligible person living with ALS.

A wider loss of $42.7 million, or 65 cents per share, for Q4 2022, compared to a loss of $28.3 million, or $4.10 per share, for the same period a year ago. The company’s revenue for the quarter was $21.9 million, compared to no revenue for the same period in the previous year, beating analysts’ expectations of $4.7 million. Analysts polled by FactSet had expected the company to report a loss of 82 cents per share.

  • Goldman Sachs analyst Chris Shibutani raised the price target from $41 to $47 and maintained a Neutral rating.
  • Citigroup analyst Itay Michaeli increased his price target for the company from $51 to $54 and kept a Buy rating.
  • HC Wainwright & Co. analyst Andrew Fein reiterated a Buy rating and maintained the price target at $50

Momentive Global

Has agreed to sell to a group led by private-equity firm Symphony Technology for $9.46 per share, or about $1.5 billion. This acquisition is Momentive’s second attempt to find a buyer; the first deal, in which software firm Zendesk was set to acquire Momentive for $28 a share in stock, was rejected by Zendesk shareholders.

  • Craig-Hallum analyst Chad Bennett downgraded from Buy to Hold and set a $9.5 price target.
  • Credit Suisse analyst Stephen Ju maintained a Neutral rating but lowered the price target from $13 to $9.46.
  • Needham analyst Ryan MacDonald downgraded Momentive from Buy to Hold.

SGEN

Pfizer having made a $43 billion bid for Seagen, a cancer-focused biotech firm, with the expectation that Seagen’s cancer therapy revenue could reach $10 billion in 2030. Seagen is known for its antibody-drug conjugates (ADCs), a cancer treatment that can target tumors with a toxic agent, and the market for these drugs is projected to be a significant part of the $375 billion global cancer-drug market. For Pfizer, the acquisition would expand its portfolio of breast and bladder cancer therapies and offset an expected $17 billion sales loss by 2030 as some of its top-selling drugs lose patent protection.

  • BMO Capital Etzer Darout has downgraded from Outperform to Market Perform, but raised his price target from $179 to $229.
  • JMP Securities analyst Reni Benjamin has downgraded Seagen from Market Outperform to Market Perform.
  • Barclays analyst Gena Wang has maintained Seagen with an Equal-Weight and raised the price target from $145 to $228.
  • Raymond James analyst Dane Leone has downgraded Seagen from Strong Buy to Market Perform.
  • Needham analyst Ami Fadia has downgraded Seagen from Buy to Hold.