Brookline starts Exelixis with Buy on commercial drugs, pipeline

Brookline analyst Leah Rush Cann initiated coverage of Exelixis (EXEL) with a Buy rating. The firm anticipates Exelixis will continue to develop its commercial drugs, Cabometyx, and Cometriq, while its partner Genentech will continue to develop Cotellic. The analyst sees potential from the company’s earlier stage pipeline. Based on its expectation that Exelixis will grow unit sales of its first three products, add indications for Cabometyx, and commercialize a product from its pipeline in the next few years, Brookline estimates the company’s total revenue will grow 15% annually for the next 7-10 years, increasing to $7.1B in 2033. Exelixis, on a probability and investment risk-adjusted basis, could be valued at $40 per share in the next 12 to 18 months, the firm contends.