BAVA: Procurement Agreement And Margin Outlook Signal Upside For Shares

Analysts have raised their price target for Bavarian Nordic from €250 to €260. They cite improvements in projected profit margins and lower expected future price-to-earnings ratios, even though there is a modest increase in the discount rate and a slightly weaker revenue growth outlook.

What's in the News

• Officials confirm community spread of a new clade 1 Mpox strain in Southern California, marking the first local transmission of this strain in the state (NBC).
• Bavarian Nordic A/S announced a new joint procurement contract by the European Commission. This agreement enables the purchase of up to 8 million doses of the MVA-BN smallpox/mpox vaccine over two years, with the first 750,000 doses scheduled for delivery in 2026.
• The company reported positive topline results from a clinical study, showing that the immune response in children aged 2-11 who received the MVA-BN vaccine was non-inferior to adults. The highest responses were seen in the youngest group, and plans are underway to seek EMA approval to extend the vaccine's use to younger children.
• Bavarian Nordic has provided earnings guidance for 2025 and expects total revenue of approximately DKK 6,000 million, reaffirming its previous outlook.
• The planned acquisition of Bavarian Nordic by Nordic Capital Epsilon and Permira was cancelled after the offer did not meet the minimum acceptance threshold. The acquisition process has been irrevocably terminated.

Valuation Changes

• Consensus Analyst Price Target has increased from €250 to €260.
• The discount rate has risen slightly, moving from 4.97% to 5.15%.
• Revenue growth expectation has declined, shifting from -3.46% to -4.45%.
• Net profit margin is projected to improve, rising from 15.82% to 17.28%.
• The future P/E ratio has decreased slightly, from 23.92x to 22.42x.