Amgen (NASDAQ:AMGN) Slips as Obesity Drugs Take Center Stage
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Amgen (NASDAQ:AMGN) Slips as Obesity Drugs Take Center Stage

Story Highlights

Amgen faces scrutiny on its weight loss drugs, but has more than that afoot.

Obesity drugs are increasingly a part of the package for many drug companies out there, and Amgen (NASDAQ:AMGN) is no different. In fact, its lineup of weight loss drugs will come under particular scrutiny ahead of its fourth-quarter results, a move that left investors a little less than pleased. Amgen stock was down fractionally in Monday afternoon’s trading as a result.

The latest word out of the company notes that Amgen is stepping up its testing on both AMG 133 and AMG 786. AMG 133 is also known as maridebart cafraglutide, a GLP-1 receptor agonist. Meanwhile, AMG 786 is an oral therapy that doesn’t use incretin as a base. Regardless of the methodology involved, it’s clear that Amgen’s weight loss drugs will be closely watched.

In fact, people like Barclays analyst Carter Gould belive that the weight loss drug series is much of the reason behind Amgen’s current valuation. However, Gould also questions if the drugs in question will go live as expected in the first half of 2024. It’s worth mentioning that Gould has a Sell rating on the stock with a $230 price target.

More Than Just Weight Loss

While certainly, weight loss drugs will have a solid market on their hands, there will also be a lot of room for some of Amgen’s other upcoming developments. It’s teaming up with Astellas to get patients to test their biomarkers as part of a campaign to attack stomach cancer. With stomach cancer the fifth most commonly diagnosed cancer in the world, it suffers from a fundamental lack of awareness. But with this new campaign, Amgen is hoping to call attention to the disease, and likely by extension, some of the treatment options it can offer.

Is Amgen a Buy, Sell or Hold?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on AMGN stock based on 11 Buys, five Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 36.72% rally in its share price over the past year, the average AMGN price target of $310.20 per share implies 3.78% downside risk.



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