On Monday, BMO Capital Markets adjusted its outlook on Y-mAbs Therapeutics (NASDAQ:YMAB), a biopharmaceutical company, by increasing the price target to $26 from the previous $16. The firm reaffirmed its Outperform rating on the stock following Y-mAbs' financial year 2023 earnings call, which was held earlier in the day and was deemed satisfactory by the analysts.
BMO's revision of the price target comes after discussions with the management of Y-mAbs and a reassessment of the net present value (NPV) for the company's Danyelza drug. The new target reflects a significant increase in the NPV to $17, up from $9, attributed mainly to lower operational expenses for the drug than previously anticipated.
The Outperform rating was reiterated based on the company's current spending trajectory, which has influenced BMO's valuation of the drug. The analysis of the operational expenses has been a key factor in the revised valuation, indicating a more efficient cost structure for Y-mAbs.
Looking ahead, BMO Capital expressed a positive outlook on the clinical updates for Y-mAbs' GD2-SADA asset, which are expected in the second half of the year. The anticipation of these updates has contributed to the firm's optimistic stance on the stock.
The upgrade in the price target is indicative of BMO's confidence in Y-mAbs' trajectory and its ability to manage costs effectively, which could potentially enhance shareholder value. This adjustment in the stock's outlook is based on the latest financial data and management's guidance, reflecting the company's current position and future prospects.
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