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ALLISON GATLIN

How IBD Stock Of The Day ADMA Biologics Shrugged Off Accounting Debacle For A Bullish Comeback

ADMA Biologics is Thursday's IBD Stock Of The Day. After an accounting debacle hammered shares in late 2024, ADMA stock is making a bullish comeback, building the right side of a new base and possibly a handle.

Ramsey, New Jersey-based ADMA Biologics makes human-derived immunoglobulin. Its products treat people whose bodies don't make enough antibodies to ward off illnesses from common viruses. Instead of risking illness, people with primary immunodeficiency receive regular infusions of ADMA's drugs.

Mizuho Securities analyst Anthony Petrone called the company's recent 10-K filing with the Securities and Exchange Commission a "clearing event" for investors.

Last year, the company's previous accounting firm quit without notice or explanation and ADMA stock dropped. This filing came within a two-week extension period and followed an audit by ADMA Biologics' new accounting firm, KPMG.

"In our view, this should officially put the company's accounting concerns to bed, which started last Fall with prior firm CohnReznick's resignation," Mizuho Securities analyst Anthony Petrone said in a note. "Underlying performance for ADMA has been strong as ever, with a beat and raise of 2025 and 2026 guidance following its 4Q24 earnings."

ADMA Stock: A Path To $1.9 Billion In Sales

Petrone sees a path to $1.6 billion to $1.9 billion in peak sales of ADMA's biggest moneymaker, Asceniv. ADMA Biologics developed Asceniv in-house. It's a cocktail created from super donors whose plasma has a high level of antibodies capable of handling respiratory syncytial virus, or RSV. RSV leads to cold symptoms in most people, but it can be serious in people with compromised immune systems.

Last year, Asceniv generated $216.7 million in sales. This year, it's expected to bring in $283 million, growing almost 31%. Earnings are also promising. In 2024, ADMA Biologics earned 49 cents per share, flipping from no earnings in the year-earlier period. This year, it's expected to notch a 71-cent profit, up 45%.

Asceniv accounts for slightly more than half of ADMA's total sales. The company also sells Bivigam and Nabi-HB, two products it acquired. Bivigam provides various antibodies found in a healthy immune system, while Nabi-HB protects against hepatitis B in people who've been exposed.

Petrone says the supply math indicates Asceniv could top $1.5 billion in sales potential. ADMA owns 10 plasma collection facilities and has access to 250 outside its own network. Analysts polled by FactSet currently predict $916.2 million in sales in 2030 — the latest year for which there are forecasts.

"We believe the ASCENIV story has been overshadowed by accounting, but the asset is inflecting and the path to $1bn annual revenue is underway," Mizuho's Petrone said.

ADMA Biologics' Improvement Plans

ADMA Biologics is also putting into place a new process to yield more immunoglobulin. The Food and Drug Administration is expected to approve the process by midyear. This could drive $100 million to $300 million in sales upside annually.

"When combined with improving plasma supply and robust ASCENIV demand, this all points to significant sales and margin upside potential following yield enhancement approval," Petrone said.

Petrone reiterated his outperform rating and 32 price target on ADMA stock. But he says the potential immunoglobulin yield improvement supports a bull case of 40 for ADMA shares.

He's one of four analysts tracking ADMA Biologics for FactSet. All four have buy ratings on its shares.

Highly Rated Biotech Stock

ADMA stock is currently forming a cup base with a buy point at 23.64, according to MarketSurge. It's also trying to build a handle. The March 25 high of 20.70 would be the handle buy point, but could already serve as an early entry.

Notably, ADMA Biologics ranks third on the IBD 50 list of elite growth stocks, behind fellow biotech Travere Therapeutics.

Shares have a strong IBD Digital Composite Rating of 98 out of a best-possible 99. The score tracks a stock's fundamental and technical measures. ADMA stock also has a promising Relative Strength Rating of 97, putting it in the top 3% of all stocks in terms of 12-month performance.

Biotech And Pharma Stocks News

Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.

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