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RBC Capital ups Amgen shares target, cites cardiometabolic strategy and MariTide

EditorEmilio Ghigini
Published 06/14/2024, 09:36 AM

On Friday, RBC Capital Markets adjusted its outlook on Amgen Inc . (NASDAQ:AMGN) shares, a biopharmaceutical company, by increasing its price target to $332 from $332 while maintaining an Outperform rating. The firm's decision reflects optimism surrounding Amgen's obesity treatment program, MariTide, and its broader cardiometabolic portfolio.

RBC Capital's analysis of Amgen's commercial offerings and developmental pipeline, particularly in the cardiometabolic arena, suggests potential for revenue growth and market share gains.

The firm highlighted the importance of MariTide, a GLP-1R agonist/GIPR antagonist, which has shown very encouraging Phase II data according to management, with further data expected later in the year.

The firm emphasized that while the obesity program with MariTide is at the forefront, Amgen's adjacent programs are also noteworthy. RBC Capital identified four key pillars that support Amgen's proactive strategy in the cardiometabolic field.

These include the cholesterol-lowering drug Repatha, MariTide for obesity, olpasiran for hyperlipidemia, and an emerging pipeline that could significantly elevate Amgen's cardiometabolic platform within its General Medicine portfolio.

RBC Capital's increased price target reflects confidence in Amgen's strategic positioning and the potential for marked upside as the company continues to expand its offerings in the cardiometabolic space. The firm's reiteration of the Outperform rating indicates a positive outlook on Amgen's stock performance moving forward.

In other recent news, Amgen has reported significant findings from a Phase 3 clinical trial for UPLIZNA (inebilizumab-cdon), demonstrating an 87% reduction in flares for patients with Immunoglobulin G4-related disease (IgG4-RD). The company plans to seek regulatory approval for UPLIZNA as a treatment for IgG4-RD in the U.S. and other key markets.

Amgen also received positive attention from Cathie Wood's ARK ETFs, which acquired 13,622 shares of the biopharmaceutical giant, signaling a positive outlook on the company's growth prospects.

In the weight-loss drug market, Amgen is expecting results from mid-stage trials of its drug Maritide later this year. The global sales forecast for weight-loss drugs is predicted to reach approximately $150 billion by the early 2030s.

In the realm of analyst ratings, Wells Fargo reaffirmed its Overweight rating on Amgen, focusing on the ongoing developments of Amgen's Tezepelumab (Teze) therapy.

BMO Capital also maintained an Outperform rating and a $355.00 price target on Amgen shares following the release of updated Phase 2a COURSE data for the company's tezepelumab.

These are among the recent developments that investors should consider in their analysis of Amgen's trajectory.

InvestingPro Insights

RBC Capital's upbeat assessment of Amgen's future prospects is mirrored in the company's strong fundamentals and market performance. Amgen has demonstrated a consistent commitment to rewarding shareholders, as evidenced by a 14-year streak of maintained dividend payments, with a current dividend yield of 3.02%. This dedication to dividend growth is a key factor for investors seeking stable income streams. Moreover, Amgen's robust revenue growth over the last twelve months, up by 12.76%, alongside a gross profit margin of 66.49%, underlines the company's efficiency in generating profit from its sales—a crucial indicator of financial health and operational success.

However, potential investors should be aware that Amgen is trading at a high earnings multiple, with a P/E ratio of 42.36, which suggests a premium valuation compared to some industry peers. This high valuation is further reflected in the Price/Book ratio of 31.88. These metrics may influence investment decisions, particularly for value-oriented investors. With 11 analysts having revised their earnings estimates downwards for the upcoming period, it's important to consider these expectations in the context of the company's overall growth narrative.

For those looking to delve deeper into Amgen's financials and future outlook, InvestingPro offers additional insights and tips. Currently, there are 6 more InvestingPro Tips available for Amgen, which can be accessed through the platform. These tips provide a more comprehensive understanding of the company's performance and potential. To enhance your investment research on Amgen, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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