Takeda Pharmaceutical (TSE:4502) is back in focus after releasing new Phase 3 data for its oral TYK2 inhibitor zasocitinib in moderate to severe plaque psoriasis, alongside plans for a US FDA filing.
See our latest analysis for Takeda Pharmaceutical.
The zasocitinib update comes after a solid run in Takeda Pharmaceutical’s shares, with a 1-month share price return of 10.98% and year to date share price return of 11.47%. The 1-year total shareholder return of 31.40% and 5-year total shareholder return of 84.31% point to momentum that has built over time rather than only on the latest data point.
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Takeda Pharmaceutical’s shares have already moved on the zasocitinib news and now sit below the average analyst price target. The next step is to weigh whether that balance of risk and potential reward still favours new buyers.
Most Popular Narrative: 10.7% Undervalued
Against the last close of ¥5,480, the most followed narrative for Takeda Pharmaceutical points to a fair value of around ¥6,136, framing the psoriasis data within a broader long term thesis.
The anticipated moderation and eventual stabilization of VYVANSE generic erosion after FY2025 will remove a major headwind for revenues, allowing Takeda’s core growth and launch products to drive top-line and earnings recovery going forward.
Want to understand why this narrative still sees upside even with modest revenue growth assumptions and a higher future profit margin baked in? The entire framework leans on how earnings compound over the next few years and what kind of valuation multiple investors might accept for that profile.
Result: Fair Value of ¥6,136.87 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there are still clear risks to the Takeda Pharmaceutical story, including ongoing generic competition and the high post-Shire debt load, that could upset this thesis.
Find out about the key risks to this Takeda Pharmaceutical narrative.
Next Steps
If this mix of risks and potential rewards around Takeda Pharmaceutical leaves you unsure, act while the data is fresh and weigh both sides using 2 key rewards and 2 important warning signs
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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.
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