2Q Highlights: Piper Jaffray Weighs In on Celgene Corporation (CELG)

In a research report published Thursday, Piper Jaffray analyst Joshua Schimmer reiterated an Overweight rating on shares of Celgene Corporation (NASDAQ:CELG), with a price target of $145, after the cancer drug giant reported solid second-quarter results, with products sales of $2.745 billion, roughly $70 million ahead of consensus estimates. Shares of Celgene are currently trading at $110.90, up $2.79 or 2.58%.

Schimmer noted, “CELG reported strong 2Q16 results this morning, delivering top and bottom line beats and lifting its Revlimid, revenue and EPS full year guidance. Much to the surprise of many investors, Otezla does indeed appear to be racing towards $1B annualized, which is an impressive feat to achieve so rapidly considering the company was brand new to the psoriasis market. Over the next 3 years, CELG will be flipping over the cards on multiple P3 programs which will determine its ability to offset the Revlimid patent cliff/ramp which begins early in the next decade.”

“We are lowering our terminal growth rate from 3% to 2% as Revlimid increasingly becomes the dominant product for which offsetting the patent expiry next decade will be difficult. That said, the right combination of successes from the pipeline could more than offset this challenge and drive a stronger growth outlook,” the analyst added.

As usual, we recommend taking analyst notes with a grain of salt. According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Joshua Schimmer has a yearly average return of -9.8% and a 36.5% success rate. Schimmer has a -3.6% average return when recommending CELG, and is ranked #3983 out of 4087 analysts.

Out of the 23 analysts polled by TipRanks, 20 rate Celgene Corporation stock a Buy, while 3 rate the stock a Hold. With a return potential of 29.7%, the stock’s consensus target price stands at $142.67.

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