Weight-loss drug stocks have been in focus during the last year due to a rapidly expanding addressable market. According to an industry report, the global weight-loss drugs market is forecast to rise from $3.83 billion in 2023 to $44.12 billion in 2029, indicating annual growth rates of roughly 50% year over year.
In recent years, healthcare giants such as Novo Nordisk (NVO) and Eli Lilly (LLY) have unveiled weight-loss drugs to address these markets. Moreover, these companies are investing heavily in research and development to introduce safer, more effective weight-loss medications, and to gain traction in this robust market.
One smaller weight-loss company that is also gaining momentum is Structure Therapeutics (GPCR). Valued at $2 billion by market cap, Structure Therapeutics is a clinical-stage global biopharma company that develops oral therapeutics to treat a range of chronic diseases. GPCR stock went public in early 2023, and has since risen 42%.
Despite its outsized returns, the stock is down 50% from all-time highs, allowing you to buy the dip. Let’s see if this weight-loss stock should be part of your portfolio right now.
The Bull Case for GPCR Stock
The weight-loss drugs market is currently dominated by North America, due to rising concerns over obesity and chronic diseases. Many individuals are now actively seeking effective weight-loss management solutions that are safe, given that one-third of adults in the U.S. meet the definition of obese - which in turn increases the risk of diabetes, heart disease, and hypertension, among others.
Rising awareness among households and other societal trends have showcased the need to maintain a healthy lifestyle, driving demand for weight-loss drugs. These trends have led to the emergence and popularity of GLP-1 agonists, which help reduce weight and improve metabolic parameters such as lipid levels and blood sugar control.
JPMorgan is Bullish on Structure Therapeutics
Structure Therapeutics is a pre-revenue company that is developing amylin receptor agonists that can be used in isolation or combined with GLP-1R agonists to treat obesity and associated diseases. It's also developing a GIPR selective agonist and GLP-1R/GIPR combinations to treat obesity, and expects to select a development candidate in the first half of 2025.
Separately, Structure Therapeutics is evaluating ANPA-0073 for muscle-sparing weight loss.
JPMorgan (JPM) recently initiated coverage of Structure Therapeutics with an “overweight” rating. According to the investment bank, Structure’s stock is undervalued, given the opportunity for its oral GLP-1 drug candidate, GSBR-1290.
With existing GLP-1 blockbusters like Ozempic and Wegovy requiring injections, JPMorgan forecasts that the user-friendly oral GLP-1 market could generate sales of $30 billion by 2035 - providing Structure with an early-mover advantage.
JPMorgan has a target price of $65 for GPCR stock, about 75.3% above its current trading price.
What's the Analyst Forecast for GPCR Stock?
JPMorgan isn't alone in its bullish view on the stock. Each of the nine analysts covering Structure Therapeutics recommend a “strong buy.”
What's more, the mean target price for GPCR stock is $78.78 - indicating an upside potential of more than 112% from current levels.
On the date of publication, Aditya Raghunath 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.
