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SRPT Stock Rises 23% in a Year: Time to Buy, Hold or Sell?
SRPTSarepta Therapeutics(SRPT) ZACKS·2025-01-06 13:51

Core Viewpoint - Sarepta Therapeutics (SRPT) has experienced a 23% increase in stock price over the past year, outperforming the industry which saw a decline of 15.7% [1][4] Group 1: Stock Performance - SRPT's stock has outperformed the broader Medical sector but slightly underperformed the S&P 500 Index [1] - The stock is currently trading above the 50-day moving average [1] Group 2: Revenue Growth from Elevidys - Elevidys, the first one-shot gene therapy for Duchenne muscular dystrophy (DMD), has shown significant sales performance since its launch in June 2023, contributing over 200milliontorevenuein2023[5][6]−TheFDAexpandedElevidys′labeltotreatallDMDpatientsagedfouryearsandolder,leadingtoover200 million to revenue in 2023 [5][6] - The FDA expanded Elevidys' label to treat all DMD patients aged four years and older, leading to over 400 million in revenue in the first nine months of 2024 [6] Group 3: Partnerships and Future Revenue - Sarepta has a licensing agreement with Roche, which has exclusive rights to market Elevidys outside the U.S., generating 9.5millioninroyaltyrevenuesinQ32024[7]−Managementanticipatesnetproductrevenuesof9.5 million in royalty revenues in Q3 2024 [7] - Management anticipates net product revenues of 2.9-3.1billionfor2025,withtwo−thirdsexpectedfromElevidyssales[8]Group4:PipelineExpansion−SareptaisexpandingitspipelinebeyondDMD,focusingonmultipleinnovativegenetherapiesforvariousmusculardystrophies[9][10]−Thecompanyisconductinglate−stagestudiesongenetherapycandidatesforlimb−girdlemusculardystrophyandhasplansforadditionalclinicalstudies[11][12]Group5:StrategicAcquisitions−InNovember,Sareptaannounceda3.1 billion for 2025, with two-thirds expected from Elevidys sales [8] Group 4: Pipeline Expansion - Sarepta is expanding its pipeline beyond DMD, focusing on multiple innovative gene therapies for various muscular dystrophies [9][10] - The company is conducting late-stage studies on gene therapy candidates for limb-girdle muscular dystrophy and has plans for additional clinical studies [11][12] Group 5: Strategic Acquisitions - In November, Sarepta announced a 500 million deal to acquire seven pipeline programs from Arrowhead Pharmaceuticals, which will enhance its portfolio and expand into new indications [13] Group 6: Market Dependence and Valuation - Despite having four FDA-approved therapies, Sarepta's revenue is heavily reliant on Elevidys, which accounted for over one-third of total revenues in the first nine months of 2024 [14] - The stock trades at a premium with a price/sales ratio of 7.73 compared to the industry average of 1.96 [15] Group 7: Earnings Estimates - Earnings per share (EPS) estimates for 2024 have increased from 1.48to1.48 to 2.17, while 2025 estimates have slightly decreased from 10.35to10.35 to 10.04 [17] Group 8: Investment Recommendation - Despite trading at a premium, the strong commercial potential of Elevidys and management's plans for diversification make it a recommended addition to investment portfolios [18][19]