Sarepta Therapeutics: Safety Uncertainty and Label Risk Overshadow Elevidys Data, Supporting Sell/High Risk Rating

Citi analyst Yigal Nochomovitz has assigned their bearish stance on SRPT stock, giving a Sell rating today.

Yigal Nochomovitz has given his Sell rating due to a combination of factors linked to Sarepta’s risk/benefit profile and commercial outlook. He acknowledges that the new three-year EMBARK data in ambulatory Duchenne muscular dystrophy patients strengthen the case that Elevidys offers meaningful functional benefit, but he sees this as largely reinforcing existing expectations rather than transforming the investment thesis. In his view, the main constraints on Elevidys uptake are not questions about efficacy but unresolved issues related to safety, particularly the risk of acute liver injury and liver failure, and the uncertainty surrounding the product’s ability to regain or expand its label in non-ambulatory patients.

Nochomovitz points out that key upcoming data sets focused on prophylactic sirolimus—real‑world ambulatory experience, the ENDEAVOR Cohort 8 non‑ambulatory data, and the future Study 402 readout—are still several quarters away and may or may not be sufficient to satisfy regulators on safety. He also notes that some of the EMBARK milestone findings (such as loss of ambulation versus external controls) are based on small patient numbers and have not yet been stress‑tested with additional sensitivity analyses, which limits confidence in extrapolating their impact. Taken together, the reliance on external controls, the heavy dependence on future, unproven safety mitigation strategies, and the uncertainty around Elevidys’ trajectory in the broader DMD population lead him to view downside risk to the stock as substantial, supporting a Sell / High Risk rating and a projected large negative return from current levels.

In another report released today, H.C. Wainwright also reiterated a Sell rating on the stock with a $5.00 price target.

Based on the recent corporate insider activity of 47 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of SRPT in relation to earlier this year.