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Wells Fargo initiated coverage of Halozyme Therapeutics with a rating of Overweight and set a new price target of $65.00
https://quantisnow.com/insight/3733681
SVB Securities analyst David Risinger maintained a Buy rating on Halozyme today and set a price target of $62.00. The company’s shares closed last Friday at $53.97, close to its 52-week high of $54.67.
Here is why it’s not good idea to bet against Halozyme. From fool.com: “With just the drugs on the market, Halozyme's revenue should grow from about $260 million in 2020 to over $1 billion by 2024. Royalty revenue generates about 90% incremental margins. Earnings and cash flow should grow at a very attractive rate.” (See source link below)
This earnings growth and halo’s phat profit margin are secular and agnostic to interest rates and recessions. As such, anytime IBB, XBI or overall market conditions drag Halozyme’s price, consider it a gift from “Mr. Market” and load up more. Hold on to your shares and add more with every dip.
This strategy has worked well in 10’s, 20’s, 30’s and 40’s and will work all the way to 100’s. Bottomline is that if earnings are multiplying several fold over the next few years, the share price should at least double. The PE and PEG ratio are still low when considering the profit margin and proven earnings growth.
From Nasdaq:
PE ratios:
2023 Estimates 18.42
2024 Estimates 14.39
From Finviz:
PEG 0.64
https://www.fool.com/investing/2022/11/11/interview-with-quoc-tran-of-tran-capital/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article&yptr=yahoo
Do you agree with their prediction, maumar? How about you, Fred? Are you thinking about selling more calls?
Halozyme announced Johnson & Johnson (JNJ) would test a treatment combination in lung cancer patients. The combo will use Halozyme's drug delivery system, Enhanze.
This is the first product from Halozyme's so-called "Wave 4" to begin final-phase testing. The first wave of products launched in 2021 with the second following in 2023. Fourth-wave products will launch in 2025 and beyond.
Johnson & Johnson expects this combination of drugs — dubbed amivantamab and lazertinib — to bring in a peak of more than $5 billion in sales, SVB Securities analyst David Risinger said in a note to clients.
"If the combination succeeds Halozyme could be eligible to receive royalties on another blockbuster potential product," Risinger said. "Amivantamab royalties are not reflected in our Halozyme estimates and represent upside."
https://www.investors.com/research/ibd-stock-of-the-day/halo-stock-surges-into-breakout-with-another-potential-blockbuster-in-view/
In a report released today, Jason Butler from JMP Securities reiterated a Buy rating on Halozyme (HALO – Research Report), with a price target of $62.00. The company’s shares closed yesterday at $45.83.
Excellent conference call and earnings results. Halozyme is significantly undervalued. Mid to high 50’s are in the bag
No insider selling since February, not even for paying taxes on awarded options. I’ve been an investor in Halo since 2011 and don’t recall this long a period without insider selling (again paying taxes). Insiders believe Halo is worth a lot more.
It’s trading at a PE of 24 for 2022 and PE of 16 for 2023 (see link below). Considering the recent market conditions, and to a novice, this may seem fairly or even richly valued. However, such a conclusion is shortsighted because:
1) Halo has a terrific PEG ratio of 0.81 (i.e. significant and proven earnings growth at a bargain price)
2) Halozyme is in a secular and interest rate agnostic pharma sector which has and will continue to see major in-flows especially after elections. Split government is good for biopharma.
3) Phat profit margin of 75% (see link below)
4) Share buy backs
We are overdue for some fresh partnerships which will not only add momentum but also immediately make the PE even more favorable due to the upfront payments and further improved E.
I would consider dollar-profit-averaging out between $65 and $100 (if no are no new positive catalysts)
At these bargain prices, I continue to purchase OWNERSHIP in this company. If it drops in price due to overall market conditions, I will continue to add as I have on monthly (and often weekly) basis for over 10 years.
https://www.nasdaq.com/market-activity/stocks/halo/price-earnings-peg-ratios
https://finviz.com/quote.ashx?t=HALO&p=d
Halo might beat by more than 1% since its SC share may have grown also (bigger slice of a bigger pie) if they are disciplined with expenses.
J&J results beat estimates on cancer drug strength
Reuters3:14 AM PDT
Johnson & Johnson (JNJ.N) on Tuesday beat Wall Street estimates for quarterly revenue and profit on strong demand for its cancer drug Darzalex
Sales of cancer drug Darzalex jumped 29.8% to $2.05 billion
“Morgan Stanley suggests that investors who are looking for safety in a volatile market might consider investing in this biotechnology stock. Andrew Galler, analyst at Morgan Stanley, began coverage of Halozyme Therapeutics. The company was given an overweight rating and a price target of $50. Galler described the company as a “safe port” in a storm. He wrote that Halozyme was the most defensive name we covered due to its established royalty business, long term potential for growth and diversified base business through its acquisition of Antares. Galler specifically sees value and diversification in Halozyme’s revenue streams. He emphasized Enhanze’s drug delivery technology platform. This platform is being used by major biopharmaceutical companies such as Pfizer and Bristol-Myers Squibb. Morgan Stanley’s $50 price target indicates that shares could rise 26% after Thursday’s close. He wrote that “While we don’t see any significant upside drivers other than continued expansion of Enhanze portfolio, and commercial executions by partners in near-term”, he said. — CNBC’s Michael Bloom contributed to this report.”
On CNBC now:
Morgan Stanley calls for a 26% gain in this under-the-radar ‘safe port in the storm’
PUBLISHED FRI, SEP 9 20228:51 AM EDT
https://www.cnbc.com/2022/09/09/morgan-stanley-calls-for-a-26percent-gain-in-this-under-the-radar-safe-port-in-the-storm.html
Morgan Stanley initiated coverage of Halozyme Therapeutics with a rating of Overweight and set a new price target of $50.00
Halozyme has the potential to disrupt the retail/commercial OTC IV hydration/vitamin/nutrient/supplement industry. More and more of these centers are popping up in various cities. Just google “IV hydration nutrient or supplement” and you will see all the commercial practices that are offering this service (or see sample links below). Now with the auto-injector+Enhanze combo, Halozyme can offer the small volume supplements/nutrients as OTC at home. For hydration and larger volume nutrients, the customer can visit one of these centers or the practitioner can visit the customer at their home. However, instead of a cumbersome IV start (which takes time and skill), the practicer can do the SC in 5 minutes. Any time there is an IV start, the vein is damaged some and overtime the patient runs out of veins (eg. IV drug users have no veins after a while, or chemo patients get a central line port instead of repeated IV starts). I have also contacted a few of these centers. They run their IV’s over 20-30 minutes. So there is also a significant time saving advantage with Enhanze.
https://www.nutridrip.com
https://livewellclinic.org/services/iv-nutrient-therapy%E2%80%8B/
https://www.ivlounge-edh.com
https://www.bouncehydration.com/blog/iv-therapy-benefits/
I hope so. Would love to load up more.
That was the second round of convertibles. Including the most recent one, there have been 3 rounds.
If I remember correctly, the very first convertibles had a trigger of high teens or low $20’s and the Halo surpassed that threshold quickly (within a few months).
You were correct :)
Ok, so now we know the “why.” No matter how you look at the convertible bonds, it certainly does not reduce the future earnings potential of halozyme anywhere near the 20% haircut the share price has seen lately. Halozyme should rally from here.
New phase 2 trial posted today. Janssen and Enhanze, RYBREVANT for non-small cell lung cancer
A Study of Amivantamab in Participants With Advanced or Metastatic Solid Tumors Including Epidermal Growth Factor Receptor (EGFR)-Mutated Non-Small Cell Lung Cancer (PALOMA-2)
https://clinicaltrials.gov/ct2/show/NCT05498428?term=Rhuph20&draw=2&rank=94
Thank you. I was waiting for a signal like that. Reminds us of when the technical pessimism set in at the low 30’s and low 20’s before that. Comments like this signaled the bottom then and do the same now.
The part about Melanoma is new. I don’t recall a previous mention of Opdivo/Enhanze for Melanoma before.
Brand new phase 2 trial post today:
Sponsor:
Bristol-Myers Squibb
Opdivo/rHuPH20
“The purpose of this study is to evaluate the switch from Nivolumab Intravenous (IV) infusions to Nivolumab Subcutaneous (SC) administration in participants with resected Stage IIIA/B/C/D or Stage IV melanoma or resected invasive Urothelial Carcinoma (UC) originating in the bladder who have high risk of recurrence.”
https://clinicaltrials.gov/ct2/show/NCT05496192?term=Rhuph20&draw=3&rank=84
There will be analyst upgrades and raised targets
The snap back will be neck-break speed. Back to 50’s soon
Perhaps we are overthinking it. There was a similar magnitude (percentage wise) haircut right before the last earnings call on May 10. The following are closing prices:
04/25/2022 $44.61
5/09/2022 $37.35
Roughly a 20% hair cut since the all time closing high of $52.98 on 7/8/22. If there is any bad news (at all), it better be equal to a 20% reduction in future earnings. Otherwise there will be a snap back. Halo was already cheap with a PE in the mid teens profit considering a profit margin greater than 60% and steady projected earnings growth beyond 2030.
I’m buying more :)
If earnings are in-line or better and no bad news tomorrow, expect a snap back into 50’s. Halo has some catching up to do with XBI for the past week or so.
From Roche’s Q2 earnings report released yesterday: “Phesgo (first approved in 2020; CHF 325 million, +241%). Early and metastatic HER2-positive breast cancer (fixed-dose combination of Perjeta and Herceptin for subcutaneous injection). Offers faster administration in just minutes, compared to hours with standard intravenous administration. Sales continued to show a considerable uptake, especially in Europe and the United States.”
Q2 “Darzalex sales were higher than both the consensus estimate and Jefferies’s own projections for the drug”
https://medwatch.com/News/Pharma___Biotech/article14248893.ece
Enjoy the dip. Take advantage of the bargain
Looks like you were correct. No news of new partnership.
Nonetheless, enjoy buying the little dips
…. and on higher volume than average
Agreed! Halozyme has outperformed XBI and IBB. Either there is significant news brewing or major funds are buying a whole log more.
I’m of the belief that something very positive is brewing. Volume has been high. There is very little retail involvement with Halo (over 90% institutionally owned), thus we can’t contribute the move to hype. My sense is that a big partnership with a psychiatric indication is near completion.
This Friday saw the all time highest closing price in Halozyme’s history. Previous highest closing price was $51.45 on 2/24/21. On that same day, Halozyme hit the highest intraday price of $56.4.
Compared to 2/24/22, earnings are better, fewer shares are outstanding, more programs have had success, halo has more partnerships and present/future prospects. PE ratio and PEG are attractive bargains. It’s has and continues to be no rocket science to know/predict much higher prices.
My only minor concern is if the two perm-a-nay-sayers on this board turn positive. They were negative when halo was trading in 40’s, 30’s and even lower. It might signal a short term overbought top if even they are on-board. But it really doesn’t matter; the longs welcome pull backs as further buying opportunities.