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Cambridge, Massachusetts-based Biogen Inc. (BIIB) discovers, develops, manufactures, and delivers therapies for treating neurological and neurodegenerative diseases. With a market cap of $28.8 billion, the company’s products address diseases such as multiple sclerosis, non-hodgkin's lymphoma, rheumatoid arthritis, crohn's disease, and psoriasis.
Companies worth $10 billion or more are generally described as “large-cap stocks,” and BIIB perfectly fits that description, with its market cap exceeding this mark, underscoring its size, influence, and dominance within the general drug manufacturers industry. BIIB solidifies its leadership in neurology and specialized immunology through its innovative and diversified product portfolio. Flagship multiple sclerosis treatments, TECFIDERA and AVONEX, maintain market dominance. The strategic acquisition of Reata expands BIIB's footprint into rare diseases with SKYCLARYS, the pioneering treatment for Friedreich's Ataxia, further bolsters its competitive position.
Despite its notable strength, BIIB has slipped 25.2% from its 52-week high of $269.43, achieved on Oct. 17, 2023. Over the past three months, BIIB stock has declined 9.9%, underperforming the Dow Jones Industrials Average’s ($DOWI) 8.2% gains during the same time frame.
In the longer term, shares of BIIB fell 22.2% on a YTD basis and dipped 21.5% over the past 52 weeks, significantly underperforming DOWI’s YTD gains of 11.5% and 21.8% returns over the last year.
To confirm the bearish trend, BIIB has been trading below its 50-day and 200-day moving averages since late July.
Biogen's stock performance suffered due to setbacks with its Alzheimer's treatment, Leqembi, and declining sales of key multiple sclerosis (MS) treatments, Tecfidera and Tysabri. While new product revenues provided some relief, the company has faced additional headwinds from decreased contract manufacturing and royalty income.
On Aug. 1, BIIB shares closed down more than 1% after reporting its Q2 results. Its revenue stood at $2.5 billion, up marginally year over year. The company’s adjusted EPS increased 31.3% year over year to $5.28.
In the competitive arena of general drug manufacturers, Gilead Sciences, Inc. (GILD) has taken the lead over BIIB, delivering 3.6% returns on a YTD basis and solid 10.7% gains over the past 52 weeks.
Wall Street analysts are moderately bullish on BIIB’s prospects. The stock has a consensus “Moderate Buy” rating from the 28 analysts covering it, and the mean price target of $270.81 suggests a potential upside of 34.4% from current price levels.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
