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BIIB 50% Swing Trade Setup

BIIB is forming a bullish rebound in the buy zone. I think there could be a 50%+ rally towards the yellow trendline over the next few months. TrendSpider’s seasonality index is bullish between May and August.

Entry price:

  • $189.04 to $221.31

SL:

  • $185

Exit price:

  • Yellow trendline, approximately $300.

Biogen Inc. (BIIB) Financials

Leqembi’s Growth: Biogen’s Alzheimer’s therapy, Leqembi, has experienced a significant uptick in sales, reaching $19 million in Q1 ’24, nearly tripling Q4 revenues. Despite challenges in gaining coverage and reimbursement, Leqembi is expected to achieve multi-billion dollar sales levels by the end of the decade.

Potential Blockbuster: Leqembi’s potential as a blockbuster drug has long been anticipated, and its recent traction indicates a promising future. Despite initial setbacks, including a disappointing launch, the drug is now gaining momentum, with patient numbers increasing significantly in Q1 ’24.

Sales Forecast: Forecasts suggest that Leqembi could reach sales of $12.9 billion through 2028, with a significant portion of sales coming from the U.S. market alone. Despite difficulties in gaining coverage, the drug’s potential remains high, with estimates projecting sales levels of $3 billion to $4.6 billion by 2028.

Sales Decline: Biogen’s overall sales have been declining, but the combination of Leqembi and other new drugs like Skyclarys could help reverse this trend. Q1 ’24 sales were down nearly 7% year-over-year, but the company expects slight growth towards the end of 2024 and into 2025.

Valuation: Despite the decline in sales, Biogen’s stock is considered cheap, trading at only 12.4x 2025 EPS targets. Analyst estimates suggest significant EPS growth in the coming years, driven by successful drug launches and expense reduction initiatives.

Investment Thesis: Biogen presents a compelling investment opportunity, particularly with Leqembi’s potential to become a hit drug with billions in annual sales by the end of the decade. The stock’s current valuation and potential for sales growth make it an attractive option for investors.

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