Nov. 25 at 1:10 AM
$LEGN 's market cap is a disgrace when compared to analyst revenue estimates. Today LEGN hit its 52-week low while the XBI is trading at multi-year highs. LEGN management & BOD need to consider a sale to maximize shareholder value because, clearly, their plan is not working.
The attachment compares the valuations paid to acquire 5 LEGN peers as multiples of projected revenues. Peers are those comm'l-stage bios projected to generate, more or less, the same revenue dollars over the next 4-10 years.
Note LEGN trades for 0.17X their cumulative 10-year analyst revenue estimates. The 5 were acquired for 0.32X to 0.49X. LEGN's true gross margin profile is not clear to us but the peers' gross margins are not "off-the-charts" competitive.
The odds of LEGN scoring a 2nd approval are dismal (consistent with any bio). Why in the world
$JNJ does not simply buy them. Everyone wins in M&A, especially healthcare costs in general via consolidation.
$XBI $IBB
