Biogen stock took a hit Wednesday after the biotech company issued light guidance for 2025 despite beating most fourth-quarter expectations.
For the current year, the biotech company calls for adjusted profit of $15.25 to $16.25. The high end of Biogen's outlook missed projections for $16.33, according to FactSet. The company also calls for sales to decline by a mid single-digit percentage in constant currency. In comparison, analysts call for $9.4 billion in 2025 sales, down 2.8%.
Investors should have expected the light earnings outlook, RBC Capital Markets analyst Brian Abrahams said in a report.
"We do not believe flat/down earnings this year will be of any surprise," he said.
But Biogen stock skidded 4.3% to close at 133.43. Shares ended the regular session on Tuesday at the lowest level since February 2013 and are below their 50-day moving average. Biogen has largely traded below that key level of support since last July, MarketSurge shows.
Biogen Stock: Sales, Earnings Beat
Across all products, Biogen's fourth-quarter sales inched 3% ahead to $2.46 billion. That topped expectations for $2.41 billion. Adjusted profit climbed 17% to $3.44 per share, beating forecasts for $3.35 a share.
Notably, sales from Biogen's biggest segment, multiple sclerosis treatments, declined 8% to $1.07 billion. Promisingly, Alzheimer's drug Leqembi — developed with Japan's Eisai — hit $87 million. That crushed projections for $67 million, "representing good sequential growth," Biogen said in its news release.
Revenue from Spinraza, Biogen's spinal muscular atrophy drug, also topped forecasts at $421 million, vs. expectations for $414 million to $419 million, Wedbush analyst Laura Chico said in a report.
But Skyclarys, a Friedreich's ataxia treatment, brought in $102 million in sales. That matched the third quarter, and missed forecasts by $10 million. Biogen noted U.S. sales were a low $71 million due to stockpiling and Medicare discount dynamics.
"That said, ex-U.S. at $31M came in above our $27M [estimates], highlighting the ex-U.S. [opportunity] which the company has been more vocal about recently, and with the possibility of expanding in South Africa could see additional ex-U.S. growth for the franchise," RBC Capital's Abrahams said.
He has an outperform rating and 231 price target on Biogen stock.
Shares Are Under Pressure
Biogen stock remains under pressure with a low IBD Digital Relative Strength Rating of 10. This means the stock ranks in the bottom 10% of all stocks when it comes to 12-month performance. But Chief Executive Christopher Viehbacher was upbeat on the company's outlook, especially where Leqembi is concerned.
"We believe 2024 was an important year on our journey to deliver long-term sustainable growth," he said in a written statement. "We delivered continued revenue growth from our ongoing product launches including Leqembi, where we believe there remains a significant long-term opportunity."
RBC's Abrahams noted Biogen trimmed several drugs from its pipeline and is now likely looking to buy innovation.
"Story getting cleaner and more focused," he said. "While nothing overly exciting in the print, stage feels set for an improving narrative and sentiment/stock seems to be at a bottom."
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
