Recursion Pharmaceuticals initiated with a Buy at Needham

Needham analyst Gil Blum initiated coverage of Recursion Pharmaceuticals (RXRX) with a Buy rating and $17 price target. The company takes a fundamentally different approach to drug development by using a fully automated generator of millions of biological experiments and applying artificial intelligence to identify non-obvious relationships and novel biology, the analyst tells investors in a research note. Needham adds that Recursion Pharmaceuticals’ reliance on creating an ever-green pipeline of Pharma collaborations should be the key value driver for the company, with the internal pipeline serving as a proof-of-concept. With partners that include Bayer (BAYRY) and Roche (RHHBY), Recursion’s total potential revenue from Pharma partners is significantly higher than that of its peers, Needham states.