HALO: Future Upside Will Depend On Execution Amid Ongoing Patent Litigation

Analysts have modestly lifted their price targets on Halozyme Therapeutics, citing stronger than expected ENHANZE-driven growth, an accelerated path to more than $1B in 2026 EBITDA, and reduced concerns over Medicare Part B exposure, with recent targets moving as high as $92 from prior levels near $75 to $91.

Analyst Commentary

Analysts continue to refine their views on Halozyme Therapeutics, with recent research emphasizing both the upside from ENHANZE driven expansion and the remaining uncertainties around competition and reimbursement exposure. The balance of opinion leans constructive, but with a focus on execution against updated growth targets and legal overhangs.

Bullish Takeaways

• Bullish analysts point to a strong recent quarter, highlighting ENHANZE partnered products expanding across new indications and geographies as a key driver of sustained royalty and collaboration revenue growth, supporting higher valuation multiples.
• Upward revisions to 2026 EBITDA expectations, including projections of more than $1B reached a year ahead of prior long term guidance, are viewed as evidence of improving operating leverage and a clearer line of sight to accelerated earnings power.
• New company disclosures suggesting only about 20% of ENHANZE partnered product global sales are tied to Medicare Part B reduce perceived reimbursement risk, improving confidence in the durability of cash flows and justifying target price increases.
• Some bullish analysts see the stock reset as largely complete, with rating upgrades reflecting a view that prior concerns about exposure and competition were excessive relative to the company’s execution track record and growth pipeline.

Bearish Takeaways

• More cautious analysts maintain neutral stances, with price target increases described as model updates rather than conviction upgrades, signaling continued wait and see positioning until additional quarters validate the higher EBITDA trajectory.
• Ongoing patent litigation involving a competing subcutaneous oncology formulation, and the pending launch of a rival SubQ checkpoint inhibitor, introduce legal and competitive uncertainty that could impact long term royalty visibility and justify some valuation discount.
• Despite lower than feared Medicare Part B exposure, reimbursement dynamics and potential policy changes remain a structural overhang for a portion of Halozyme’s partnered revenue base, limiting upside for more conservative investors.
• The spread in target prices, ranging from the mid $60s to low $90s, reflects differing assumptions on the pace of partner launches and market share capture, underscoring that execution on partner rollouts remains a key swing factor for the stock.

What's in the News

• Halozyme and Merus N.V. entered a global non exclusive collaboration and license agreement granting Merus access to ENHANZE for subcutaneous development of petosemtamab, an EGFR x LGR5 bispecific antibody (Key Developments).
• The company raised 2025 guidance, now expecting total revenue of $1,300 to $1,375 million and royalty revenue of $850 to $880 million, up from prior ranges (Key Developments).
• Halozyme reported progress on its share repurchase program, buying back 725,514 shares for $38.88 million in the latest quarter and completing 11,177,781 shares, or 9 percent, for $592.37 million under the authorization announced in February 2024 (Key Developments).
• CFO Nicole LaBrosse will remain in her role during a transition period while the company conducts an external search for a successor, with her planned departure by March 30, 2026 (Key Developments).

Valuation Changes

• Fair Value: unchanged at $76.00 per share, indicating no revision to the intrinsic value estimate.
• Discount Rate: risen slightly from 7.29 percent to 7.35 percent, reflecting a modest increase in perceived risk or required return.
• Revenue Growth: effectively unchanged, holding at approximately 16.22 percent in the updated model.
• Net Profit Margin: effectively unchanged at about 53.67 percent, suggesting stable long term profitability assumptions.
• Future P/E: risen slightly from 9.14x to 9.16x, implying a marginally higher multiple on forward earnings expectations.