Aurinia Stock: Analyst Gets a Bit More Cautious, but Still Hits the ‘Buy’ Button

While 2022 has provided little to cheer about, investors of Aurinia Pharmaceuticals (AUPH) seemed pleased enough following the commercial-stage biopharma’s latest financial statement, sending the shares up 26% in the following trading session.

Aurinia’s only commercial product is Lupkynis (voclosporin), which was given the go-ahead to treat adult patients with active lupus nephritis (LN) early last year, in what amounted to the first FDA-approved oral therapy for the autoimmune disease.

In Q1, the company generated revenue of $21.63 million, less than the $23.4 million reported in 4Q21, but above the Street’s estimate of $19.2 million. The quarter-over-quarter drop partly reflects seasonal trends but is also due to Covid’s impact. On the bottom-line, EPS of -$0.27 met Street expectations

The company also said that with omicron fading, exiting the quarter, it saw a meaningful uptick in prescribing, patient starts, and refills. This resulted in March being a record month for received patient start forms and patient starts.

As such, the company expects growth to resume and reiterated the revenue guidance of $115-$135 million in sales for the product this year.

However, to account for expectations of a “more steady, gradual trajectory for growth,” Oppenheimer’s Justin Kim has reduced his near- and long-term outlook. Although the analyst remains in Aurinia’s corner, the current macro climate also demands caution.

“Paring back our estimates, we nonetheless stay constructive on the shares, given the meaningful revenue potential for voclosporin and its bolt-on potential to a renal/rheum-focused franchise,” Kim said. “That noted, the recent shift in market conditions (valuation multiples) could pose a key risk to this view for the near-to-medium term.”

To this end, Kim rates AUPH an Outperform (i.e. Buy), while lowering the price target from $18 to $15. The implication for investors? Potential upside of 52%. (To watch Kim’s track record, click here)

There is no lack of bullish forecasts for Aurinia on Wall Street; the stock’s Strong Buy consensus rating is based on a unanimous 8 positive analyst reviews. The outlook calls for one-year gains of 143%, considering the average price target clocks in at $24.06. (See AUPH stock forecast on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.