Galapagos: Hold Rating Amid Strategic Reevaluation and Uncertainty

Leerink Partners analyst Faisal Khurshid has reiterated their neutral stance on GLPG stock, giving a Hold rating on May 13.

Faisal Khurshid has given his Hold rating due to a combination of factors affecting Galapagos. The company is re-evaluating its strategy to spin off its cash reserves and collaboration with Gilead into a separate entity, instead choosing to focus on the business development path initially intended for the spin-off. This shift indicates that the CAR-T platform may not be viable as an independent company, which adds uncertainty to the company’s future plans.
Additionally, while the exploration of strategic alternatives for the CAR-T platform is seen as a positive step, there are still many uncertainties surrounding the company’s next moves. The large cash reserves and the new leadership under a new CEO present opportunities for strategic business development. However, the existing collaboration terms with Gilead, which require significant rights concessions, complicate potential value-creating transactions. Until there is more clarity on these strategic directions, the Hold rating reflects a cautious stance.

Khurshid covers the Healthcare sector, focusing on stocks such as aTyr Pharma, Pliant Therapeutics, and Kymera Therapeutics. According to TipRanks, Khurshid has an average return of 24.3% and a 45.57% success rate on recommended stocks.