New Facilities In Ghent And Raritan Will Unlock Global Access

Key Takeaways

• Expansion of CARVYKTI’s reach and manufacturing efficiency aims to drive significant revenue growth, margin improvement, and broader patient access globally.
  
• Diversification into next-generation therapies and disciplined financial management are intended to reduce risk and support long-term profitability.
  
• Heavy reliance on one product and increasing competition, regulatory pressures, and execution risks threaten profitability, growth, and the ability to sustain margins.

Catalysts

Through its subsidiaries, operates as a biopharmaceutical company that discovers, develops, manufactures, and commercializes novel cell therapies for oncology and other indications in the United States, China, and Europe.

• Rapid capacity expansion and geographic rollout for CARVYKTI—including new commercial facilities in Ghent and Raritan and additional production partnerships—should unlock significant patient access both in the U.S. and internationally. This directly supports sustained top-line revenue growth and margin expansion through operating leverage.
  
• Continued expansion into earlier-line multiple myeloma, supported by new survival data and updated European and anticipated U.S. labels, positions CARVYKTI to address a much larger segment of the market, likely accelerating adoption and boosting revenues as community oncologist prescriptions rise.
  
• Substantial improvements in manufacturing efficiency—including a 97% success rate, reductions in turnaround time, and scalable “in vivo” CAR-T platform development—are expected to lower cost per therapy and improve profitability and net margins over time as volume increases.
  
• Strong financial position, disciplined expense management, and expected company-wide profitability by 2026 (with operating losses already reduced by half year-over-year) increase operational flexibility, minimize funding risk, and set the stage for improved future earnings and net margins.
  
• Advancing a robust pipeline beyond CARVYKTI, including next-generation CAR-T innovations like in vivo delivery and allogeneic platforms, has potential to create new revenue streams and reduce single-product dependency—positioning Legend for long-term revenue and earnings growth amid a growing patient population and increasing healthcare investment globally.

Legend Biotech Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming Legend Biotech's revenue will grow by 44.2% annually over the next 3 years.
• Analysts assume that profit margins will increase from -30.0% today to 24.0% in 3 years time.
• Analysts expect earnings to reach $524.0 million (and earnings per share of $1.02) by about May 2028, up from $-218.1 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $792.3 million in earnings, and the most bearish expecting $172.9 million.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 32.6x on those 2028 earnings, up from -24.6x today. This future PE is greater than the current PE for the US Biotechs industry at 16.3x.
• Analysts expect the number of shares outstanding to grow by 0.47% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.21%, as per the Simply Wall St company report.

Legend Biotech Future Earnings Per Share Growth

Risks

• Increasing pricing pressure and mandatory rebates—especially given the 23.1% rebate provided to significant portions of US customers (Medicaid, 340B, VA hospitals) and price bands in ex-US markets—could compress gross margins and limit revenue growth as CAR-T therapy pricing comes under greater scrutiny globally.
  
• Heavy reliance on a single flagship product, CARVYKTI, makes Legend Biotech vulnerable to future market competition (e.g., bispecific antibodies and new CAR-Ts), safety concerns, or regulatory setbacks, which could expose revenues and earnings to significant downside risk if alternatives gain traction.
  
• Rising competitive pressure in the cell therapy and oncology landscape, including from allogeneic CAR-T players and other novel immunotherapies, risks eroding Legend’s market share and could lead to price erosion, impacting long-term revenue streams and profitability.
  
• Substantial ongoing investment requirements for R&D and manufacturing capacity expansions—such as those at Tech Lane, Raritan, and Philadelphia—may reduce net margins and increase the risk of weak returns if pipeline assets or in vivo CAR-T approaches fail to deliver commercial success.
  
• Execution risk associated with community penetration and infrastructure hurdles, including accreditation, outpatient transition, and integration into community centers, could limit broad adoption and slow anticipated uptake, threatening future growth in revenues and operating leverage.

Valuation

• The analysts have a consensus price target of $76.726 for Legend Biotech based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $95.0, and the most bearish reporting a price target of just $53.12.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $2.2 billion, earnings will come to $524.0 million, and it would be trading on a PE ratio of 32.6x, assuming you use a discount rate of 6.2%.
  
• Given the current share price of $29.11, the analyst price target of $76.73 is 62.1% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.