Gene Therapy Advances Will Unlock Neurodegenerative Markets

Key Takeaways

• Innovative gene therapy platforms and a growing pipeline position Voyager for long-term growth and expanded partnership opportunities in neurodegenerative disease treatment.
  
• Advancing clinical programs and industry partnerships enhance de-risking, commercial prospects, and recurring revenue streams as regulatory and market acceptance rises.
  
• Heavy reliance on successful clinical milestones, partnerships, and external funding exposes the company to significant risks from competition, regulatory hurdles, and capital market volatility.

Catalysts

A biotechnology company, focuses on the human genetics for the cure of neurological diseases.

• Voyager’s advancing pipeline in neurodegenerative diseases, especially wholly-owned gene therapies targeting tau in Alzheimer’s, positions the company to capture future demand from the rapidly aging population and rising prevalence of CNS diseases, significantly increasing the addressable market and supporting long-term top-line revenue growth.
  
• Expansion and maturation of Voyager’s proprietary TRACER capsid and ALPL-based non-viral shuttle platforms enable more efficient and flexible delivery of genetic medicines across the blood-brain barrier, enhancing the company’s competitive advantage, IP value, and licensing revenue from pharmaceutical partners over time, which can contribute to margin expansion and recurring revenue streams.
  
• Strengthened partnerships with major pharmaceutical companies, including substantial milestone payment potential—with $8.2 billion in possible future milestones not yet included in current cash runway guidance—create a robust runway for Voyager’s business development activities, providing additional upside to both near-term cash flow and long-term earnings visibility.
  
• Near-term clinical catalysts, including the progression of tau gene silencing (VY1706) into IND-enabling studies and planned IND submission in 2026, as well as anticipated biomarker and clinical data readouts from both internal and partnered programs (such as with Neurocrine), can materially de-risk Voyager’s pipeline, driving increased pipeline probability and potential for valuation expansion as programs enter later stages.
  
• The accelerating acceptance of gene therapies by regulators and the broader adoption of high-cost advanced therapies in healthcare systems globally support faster approval timelines and improved reimbursement for Voyager’s therapies, which can reduce time-to-market, boost commercial revenues, and ultimately drive higher earnings and profitability as programs mature.

Voyager Therapeutics Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more optimistic perspective on Voyager Therapeutics compared to the consensus, based on a Fair Value that aligns with the bullish cohort of analysts.
• The bullish analysts are assuming Voyager Therapeutics's revenue will grow by 24.8% annually over the next 3 years.
• Even the bullish analysts are not forecasting that Voyager Therapeutics will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Voyager Therapeutics's profit margin will increase from -126.5% to the average US Biotechs industry of 10.5% in 3 years.
• If Voyager Therapeutics's profit margin were to converge on the industry average, you could expect earnings to reach $13.7 million (and earnings per share of $0.24) by about July 2028, up from $-84.7 million today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bullish analyst cohort, the company would need to trade at a PE ratio of 145.2x on those 2028 earnings, up from -2.1x today. This future PE is greater than the current PE for the US Biotechs industry at 16.5x.
• Analysts expect the number of shares outstanding to grow by 1.47% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.64%, as per the Simply Wall St company report.

Voyager Therapeutics Future Earnings Per Share Growth

Risks

• Voyager Therapeutics is highly dependent on successful R&D milestones and clinical trial outcomes for its narrow pipeline, particularly in the tau silencing and anti-tau antibody areas, so any clinical or regulatory setbacks could sharply reduce anticipated future revenues and negatively impact earnings.
  
• The company is expecting significant upside from milestone payments in existing and future partnerships, but failure to achieve developmental or regulatory milestones—such as those with Neurocrine or others—would directly impair non-dilutive revenue streams and cash flow, putting net margins under pressure.
  
• Sustained competition in the gene therapy and neuroscience space—highlighted by numerous third-party programs (Biogen, Merck, UCB, J&J, etc.)—raises the risk of Voyager's products being outperformed or rendered obsolete, thus reducing the company’s ability to capture or maintain market share, resulting in reduced long-term revenue and profitability.
  
• The company relies heavily on capital markets with a high cash burn and limited near-term commercial products; macroeconomic trends like persistent high inflation and tight capital markets could make fundraising more expensive or dilutive, eroding earnings per share for existing shareholders.
  
• Industry-wide regulatory scrutiny and potential for safety-related or adverse events in clinical trials could prompt stricter regulations or delays, elevating compliance costs and R&D expenditures, which would impact Voyager’s ability to generate positive operating margins in the long term.

Valuation

• The assumed bullish price target for Voyager Therapeutics is $28.8, which represents two standard deviations above the consensus price target of $15.78. This valuation is based on what can be assumed as the expectations of Voyager Therapeutics's future earnings growth, profit margins and other risk factors from analysts on the bullish end of the spectrum.
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $30.0, and the most bearish reporting a price target of just $9.0.
• In order for you to agree with the bullish analysts, you'd need to believe that by 2028, revenues will be $130.1 million, earnings will come to $13.7 million, and it would be trading on a PE ratio of 145.2x, assuming you use a discount rate of 6.6%.
• Given the current share price of $3.16, the bullish analyst price target of $28.8 is 89.0% 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.