Key insights
- Goldman Sachs initiated coverage on Neurocrine Biosciences (NBIX) with a 'Buy' rating and a $213 price target, citing a 32% upside potential. The acquisition of Soleno Therapeutics and its product Vykat XR, along with the existing Crenessity launch, are expected to drive a 12% revenue CAGR through 2030, significantly outpacing biotech peers. The stock's low PEG ratio and recent analyst earnings revisions suggest it is undervalued, positioning it favorably for future growth.
Investing.com - Goldman Sachs resumed coverage on Neurocrine Biosciences Inc. (NASDAQ:NBIX) with a buy rating and set a price target of $213.00, representing 32% upside from the current stock price of $161. The company trades at a P/E ratio of 24.72 with a notably low PEG ratio of 0.2, suggesting attractive valuation relative to growth prospects.
The firm cited the completion of the Soleno Therapeutics acquisition as strengthening the company’s medium-term revenue growth trajectory. The deal adds a third commercial product, Vykat XR, which is approved for the treatment of Prader-Willi syndrome.
Goldman Sachs projects peak sales of $1.2 billion for Vykat XR. The product was cash flow profitable before the acquisition and has some commercial overlap with Neurocrine’s launch of Crenessity in congenital adrenal hyperplasia, which Goldman Sachs estimates will reach $1.4 billion in peak sales.
The firm estimates Neurocrine will achieve a revenue compound annual growth rate of 12% through 2030. Goldman Sachs views this growth profile as attractive relative to other mid-cap biotech peers, which the firm estimates will see a 6% compound annual growth rate through 2030 using consensus estimates. The company has already demonstrated strong momentum with 28.6% revenue growth over the last twelve months. According to an InvestingPro tip, 11 analysts have revised their earnings upwards for the upcoming period, reinforcing the positive outlook. InvestingPro analysis indicates the stock is currently undervalued, with access to 10 additional ProTips and comprehensive Pro Research Reports available for deeper analysis.
Goldman Sachs analyst Corinne Johnson said the firm anticipates the key debate for Neurocrine will shift from commercial launch execution for Crenessity and Vykat XR to Phase 3 clinical catalysts in 2027 in neuropsychiatric indications.
In other recent news, Neurocrine Biosciences Inc. reported strong financial results for the first quarter of 2026, significantly exceeding earnings expectations. The company achieved earnings per share of $1.94, surpassing the projected $1.17, and reported revenue of $811 million, which was higher than the anticipated $766.85 million. In a strategic move, Neurocrine completed the acquisition of Soleno Therapeutics Inc. for $2.9 billion, integrating VYKAT XR into its product lineup. This acquisition was finalized through a cash tender offer, with Soleno now operating as a wholly owned subsidiary. Furthermore, Bernstein SocGen Group initiated coverage of Neurocrine with an outperform rating, citing the potential of its key medicines, Crenessity and Ingrezza. The firm set a price target of $221.00 for Neurocrine shares. Additionally, Neurocrine presented real-world data on its drug INGREZZA, indicating a high rate of improvement in patients with mild tardive dyskinesia. These developments highlight Neurocrine’s active engagement in expanding its portfolio and market presence.
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