In a report released yesterday, Jason Zemansky from Bank of America Securities maintained a Sell rating on Madrigal Pharmaceuticals (MDGL – Research Report), with a price target of $239.00.
Jason Zemansky’s rating is based on a combination of factors that highlight potential risks overshadowing Madrigal Pharmaceuticals’ recent successes. Although the company has demonstrated strong sales growth for Rezdiffra, with a notable 66% increase in the third quarter, Zemansky is concerned that the optimistic sales forecasts for 2025 and beyond may already be reflected in the current stock price. This aggressive expansion in projections raises questions about sustainability and potential overvaluation.
Furthermore, Zemansky points out several looming challenges that could impact Madrigal’s future performance. These include uncertainties in patient uptake due to payer management of non-responding patients, competition from GLP-1s, and the emergence of new treatments such as FGF21s and direct THR-beta competitors. While the recent data on Rezdiffra’s efficacy in advanced liver disease is promising, the early stage of these findings and the competitive landscape suggest that prescribers might prefer more established or aggressive treatment options, adding to the downside risks for the stock.
MDGL’s price has also changed moderately for the past six months – from $255.800 to $355.880, which is a 39.12% increase.