Ultragenyx Pharmaceutical: Undervalued Stock with Promising Pipeline and Strategic Entry Point

Citi analyst Yigal Nochomovitz maintained a Buy rating on Ultragenyx Pharmaceutical (RARE – Research Report) today and set a price target of $110.00.

Yigal Nochomovitz has given his Buy rating due to a combination of factors that highlight the potential upside of Ultragenyx Pharmaceutical’s stock. The current stock price reflects a multiple on the company’s top-line guidance, which, when combined with cash, suggests an undervaluation. This assessment does not even account for the expected growth in their base business, which has shown a compound annual growth rate significantly above the cost of capital over the past four years.
Furthermore, the company’s rich pipeline, which is diverse in terms of mechanisms of action and indications, is not currently factored into the stock’s valuation. The upcoming interim analysis (IA2) for a key clinical trial is seen as a catalyst, offering a strategic entry point for investors. Even if the IA2 results fall short, the potential downside is considered temporary, with the final analysis expected to recoup any losses. The statistical likelihood of success in the ongoing trials further supports this optimistic outlook, making the stock an attractive buy at its current valuation.

In another report released today, Barclays also maintained a Buy rating on the stock with a $81.00 price target.