It’s a good time to buy into beat-down Amylyx Pharmaceuticals as investors could be underestimating one of its trials, according to Goldman Sachs. Analyst Corinne Jenkins upgraded the pharmaceutical stock to buy from neutral and increased her price target by $4 to $49. Her new price target implies shares can surge 117% from Friday’s close. Shares were up about 6% in trading on Monday. Still, the stock is down about 35% this year. “On balance, we see this as an attractive entry point for the stock in the context of a strong US launch and better-than-feared outlook into PHOENIX results next year,” Jenkins said in a note to clients Sunday. AMLX 1D mountain Amylyx pops in Monday’s session Jenkins said the company had a better-than-expected commercial launch of Relyvrio, which is used for amyotrophic lateral sclerosis, or ALS, a progressive neurodegenerative disease that is commonly referred to as Lou Gehrig’s disease in the U.S. But investors have been concerned about the stock because of low expectations going into the phase 3 Phoenix study for Relyvrio. The trial, which compares Relyvrio against a placebo over a 48-week period, should have topline data in mid-2024 and overall survival data in mid-2025. Despite those concerns, Goldman’s analysis showed a more than 60% chance that the study shows statistical significance, and a more than 70% chance the findings are slightly shy of that mark. Either scenario should be sufficient for the drug to stay on the market, according to Jenkins. In other words, in Jenkins’ view, there is a better chance for success than investors fear. She did note that could there could be an impact on the peak sales opportunity within the U.S. depending on the results. But Jenkins also said the approval would likely be a positive catalyst for the beat-down stock. — CNBC’s Michael Bloom contributed to this report.
