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December 13th, 2023 | 07:30 CET

Several 100% upside potential? BioNTech, Bayer, Cardiol Therapeutics and Evotec in analyst check

  • Biotechnology
  • Pharma
Photo credits: Bayer AG

We take a look at analysts' opinions on biotech and pharmaceutical stocks. Jefferies recently renewed its "Buy" recommendation for Evotec with a target price of EUR 34. The latest partnerships confirm that the Company's unique business model is working. The situation at Bayer is quite different. While the CEO is announcing radical changes, analysts are slashing their price targets, in some cases significantly. In contrast, analysts believe that Cardiol Therapeutics could achieve several 100% gains. The cash register is full to bursting, and an exciting news flow can be expected in 2024. At BioNTech, only the cash position is currently convincing. However, this is not enough for a buy recommendation.

time to read: 4 minutes | Author: Fabian Lorenz

Table of contents:

    David Elsley, CEO, Cardiol Therapeutics Inc.
    "[...] As a company dedicated to developing treatments for rare heart diseases, we see this as an opportune moment to contribute to the fight against heart disease and make meaningful strides in improving heart health worldwide. [...]" David Elsley, CEO, Cardiol Therapeutics Inc.

    Full interview


    Cardiol Therapeutics: Around 500% share price potential?

    The experts at the Canadian analyst firm Canaccord believe that Cardiol Therapeutics' shares have a performance potential of around 500%. Following the figures for the third quarter, they have confirmed their target price of USD 6 for the shares of the Canadian biotech company. The shares, which are also traded in Germany, are currently trading at just under USD 1. The Canadians are focused on research into diseases of heart diseases. At the end of the third quarter, they had cash and cash equivalents of CAD 40.5 million. This is sufficient to finance the projects until 2026 and represents a vital risk buffer for investors. Due to the high cash position, the enterprise value of Cardiol Therapeutics is currently below USD 30 million. Given the successful development of the projects, analysts believe that this is clearly too low.

    Regarding the studies: The ongoing Phase II ARCHER study for CardiolRx™ in acute myocarditis (inflammation of the heart muscle) is expected to be completed next year. This study not only investigates safety and tolerability but also the influence on the recovery of the heart muscle. The ongoing CardiolRx™ study, MAvERIC-Pilot, for the treatment of recurrent pericarditis (inflammation of the pericardium) is also in Phase II in the United States. Patient recruitment is underway, and another partner, Massachusetts General Hospital ("Mass General"), was signed up at the beginning of December.

    Cardiol CMO Dr. Andrew Hamer: "We are delighted that the world-renowned Massachusetts General Hospital will also contribute to patient recruitment for our MAvERIC-Pilot study. Mass General is consistently ranked as one of the best hospitals in the United States and has the most extensive hospital-based research program in the country. We look forward to the support of Mass General clinicians and participating patients to achieve full enrollment in this groundbreaking study." Patient enrollment recently reached the 50% mark and is expected to be completed in the first quarter of 2024.

    Investors can, therefore, look forward to an exciting news flow in the coming year, and the current share price level is anything but high.

    BioNTech: Full cash, but no share price fantasy

    While BioNTech's revenues from the COVID-19 vaccine are declining, the Company is researching an extensive pipeline - particularly in the field of cancer. But this will take time. In the current year, the share has lost around 30% in value and is currently valued at around USD 24 billion. However, the valuation is put into perspective by a cash position of USD 13.5 billion. Nevertheless, analysts currently see hardly any price potential, and there has not been a buy recommendation for some time. UBS recently confirmed its "Neutral" rating but significantly reduced the price target. From the experts' point of view, USD 110 (previously USD 153) is currently realistic. It is pleasing that BioNTech could be profitable again this year thanks to the corona vaccine. However, there is a lot of uncertainty for the coming years. Earlier, Goldman Sachs had already confirmed its "Neutral" rating. The price target remained unchanged at USD 113. Positive momentum can only be expected in the near term if demand for the COVID-19 vaccine picks up again.

    Bayer: Price targets tumble

    Has the time come for Bayer to enter the market after the crash to EUR 30? At least CEO Bill Anderson has announced radical changes. However, this will take time. For this reason, analysts do not see any great price potential in the short term. UBS has downgraded Bayer shares from "Buy" to "Neutral". The analysts have radically reduced the price target from EUR 90 to EUR 34. Why only now remains their secret. Although Bayer's current valuation is fair and protected on the downside, there is a lack of growth prospects. The tax risk of a possible split-up of the Group should not be underestimated. In addition, independent pharmaceutical and agricultural divisions would each be relatively small in global competition.

    JP Morgan also sees little potential for Bayer shares in the coming year. Although there are some attractive stocks in the European pharmaceutical and biotech sector, the Leverkusen-based company is not one of them. As part of their sector study, the analysts have reduced their target price for Bayer shares from EUR 47 to EUR 34. The recommendation remains "Neutral". In November, JP Morgan pointed out that it was not only the setback in the study on the hopeful drug Asundexian that was a serious blow for Bayer. The analysts also pointed out that the patents for Xarelto and Eylea would soon expire.

    While the business model of Evotec is praised, there are legitimate doubts as to whether Bayer can continue to exist in its current form. Cardiol Therapeutics is still in its infancy, but the full coffers, the study updates in the coming year, and the low enterprise value speak for a buy. However, a high cash position alone is not enough for an equity story, but this can change quickly with a full pipeline like the one BioNTech has.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Fabian Lorenz

    For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.

    About the author

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