In the fast-evolving world of
biotechnology, Legend Biotech (NASDAQ: LEGN) has captured attention with its
groundbreaking CAR-T therapy and exceptional revenue growth. While the stock
has faced price pressure in recent months, its Q1 2025 earnings report reveals
a company making rapid progress, doubling its revenue year-over-year and
positioning itself for a potential swing into profitability within the next
year. In this article we will dive into Legend Biotech recent earnings, stock
performance & valuation, growth potential, and the risks investor should
consider.
About Legend Biotech
Founded in 2014 and headquartered
in Somerset, NJ, Legend Biotech specializes in developing CAR‑T
immunotherapies, notably CARVYKTI, for treating multiple myeloma. Backed by a
strategic collaboration with Janssen, its pipeline and cell-therapy
manufacturing footprint span the U.S., Europe (notably Belgium), and Asia. The
company went public in 2020, signaling its commercialization phase, transitioning
from development to global healthcare execution.
Legend Biotech Financial
Performance
Legend Biotech’s Q1 2025
financial performance showcased exceptional revenue growth, signaling strong
commercial momentum. The company reported quarterly revenue of $195.05 million,
more than doubling from $93.99 million in Q1 2024, an impressive 107.52%
year-over-year increase. However, its net loss widened, with EPS at -$0.55,
compared to -$0.33 a year earlier, reflecting a 66.67% increase in loss per
share. On a trailing twelve-month (TTM) basis, revenue reached $728.3 million,
up 112.46% from $342.8 million in the prior year, while TTM EPS improved
significantly to -$1.19 from -$2.58, marking a 53.88% reduction in net loss.
Despite operating in a high-investment phase, Legend maintains a gross profit
margin of 8.6% and a net profit margin of -29.95%, with a return on assets of
-8.77% and return on equity of -20%, highlighting early-stage scaling
pressures. Importantly, the company’s financial position remains conservative,
with a debt-to-equity ratio of just 0.36.
Over the past five years, Legend
Biotech's revenue has been growing at a 70.7% CAGR, while net income is still
negative but projected to turn positive in 2026.
Legend Biotech Fiscal 2025
& 2026 Financial Forecast
Looking ahead, analysts forecast
2025 revenue to reach $1.02 billion, a 63.13% increase from 2024’s $627.24
million, and expect non-GAAP EPS to improve to -$0.75, a 21.77% reduction in
losses. By 2026, revenue is projected to hit $1.57 billion (up 53.35%), with
non-GAAP EPS turning positive at $0.63, a major 184% improvement over 2025
forecasts. Reflecting this growth potential, analysts maintain a buy rating
with an average price target of $75.39, implying 111.53% upside, and a high-end
target of $94, representing a 163.77% potential gain from current levels.
LEGN Stock Price Performance
and Valuation
At the time this article was written, the stock was trading at $35.64 per share. The stock is down 22.3% over the past year, notably underperform the S&P 500’s 13.4% gain in the same period. Over a longer horizon, the stock has declined 10% in the past five years, compared to the S&P 500’s 100.2% increase, reflecting investor caution during the company’s high-investment, pre-profit stage and high valuation.
However, from a valuation perspective, Legend presents a compelling
opportunity. Its current price-to-sales (P/S) ratio stands at 8.97, but this is
expected to decline significantly as revenue scales, dropping to a forward P/S
of 6.42 in 2025 and further to 4.18 by 2026, indicating substantial top-line
expansion. While the company is not yet profitable in 2025 and thus lacks a
forward P/E for that year, analysts forecast a positive non-GAAP EPS in 2026,
resulting in a forward P/E of 56.57.
Based on Fiscal.ai data, if we
look at the valuation since 2021, the historical forward P/S is at its lowest
level. This indicates that the valuation is very low and therefore attractive,
as Legend Biotech is still projected to grow rapidly.
Legend Biotech Growth
potential
Legend Biotech growth prospect
remains strong, driven by several factors.
- Strong CARVYKTI Sales
Legend Biotech delivered remarkable 107.5% total revenue growth in Q1 2025, reaching $195.05 million compared to $93.99 million in Q1 2024. This growth was primarily driven by CARVYKTI sales of approximately $369 million, representing an extraordinary 135% year-over-year increase. The collaboration revenue component surged 136.4% to $185.6 million, demonstrating the strength of the partnership with Johnson & Johnson.
The company has now treated over 6,000 patients with CARVYKTI, establishing it as the strongest CAR-T launch to date. More than half of CARVYKTI utilization now occurs in earlier-line treatment settings, with 60% of incoming orders for second to fourth-line treatments, indicating successful market penetration beyond late-stage therapy. - Competitive Positioning
CARVYKTI holds a leading position in the CAR-T therapy market for multiple myeloma, benefiting from its superior overall survival outcomes compared to standard treatments. Its first-mover advantage in earlier treatment lines strengthens its competitive edge, creating significant barriers for rivals. Analysts forecast CARVYKTI sales to reach approximately $1.63 billion in 2025, reflecting strong market demand and adoption.
The global market for CARVYKTI is expected to expand dramatically, growing from $963 million in 2024 to an estimated $4.14 billion by 2029. This represents a robust compound annual growth rate (CAGR) of 33.89%, driven by increasing patient access, expanded indications, and ongoing clinical success. These factors position CARVYKTI as a dominant therapy in the evolving multiple myeloma treatment landscape, with substantial growth potential over the coming years. - Market Expansion and Global
Reach
Legend Biotech is aggressively expanding CARVYKTI's global footprint, driven by key regulatory and market access successes. In Australia, the TGA approved CARVYKTI® for second-line plus multiple myeloma patients, broadening its applicability. Europe saw a significant label expansion, with a positive CHMP opinion incorporating overall survival benefits from the pivotal CARTITUDE-4 study, reinforcing the therapy's clinical profile.
These advancements fueled remarkable international sales growth, surging over 200% year-over-year to $51 million, alongside a 65% quarter-over-quarter increase. The company's operational reach now spans 114 activated treatment centers worldwide, with strategic plans to further expand into new markets to meet escalating global demand for CARVYKTI. This concerted effort underscores Legend Biotech's commitment to maximizing patient access and market penetration.
Risks to Consider
While Legend Biotech seems to be
a fast grower, we should be mindful of potential risks.
- Safety Concerns
Legend Biotech's primary commercial product, CARVYKTI, carries safety concerns, including severe, life-threatening, or fatal neurological toxicities such as Parkinsonism, Guillain-Barré Syndrome, and cranial nerve palsies. Infections, some fatal, have also occurred in patients treated with CARVYKTI. These safety concerns, particularly neurotoxicities, could impact the adoption of CARVYKTI, even with improved treatment strategies. - Regulatory and Legal Risks
Legend Biotech faces extensive regulatory risks, particularly concerning the interpretation and application of Chinese laws and regulations. There is uncertainty regarding whether Chinese regulatory agencies might classify Legend Biotech's CAR-T cell therapies or other technologies as falling under the "Negative List" for foreign investment, which could restrict or prohibit their research and development activities in China. The company also faces ongoing regulatory hurdles in obtaining approvals for its product candidates. - Clinical Development Risks
Legend Biotech faces substantial clinical development risks, as most of its pipeline excluding CARVYKTI is still in early clinical or preclinical stages. These candidates may encounter setbacks such as failed clinical trials, lengthy regulatory approval processes, or difficulties in achieving successful commercialization. Any of these outcomes could significantly impact the company’s prospects and financial health, as progress depends on advancing new therapies to market and overcoming the inherent uncertainties of drug development.
Conclusion
Legend Biotech stands out as a
high-growth biotech stock with strong revenue momentum, improving margins, and
a clear path to profitability. Despite recent stock underperformance, its
valuation remains attractive given projected earnings growth and expanding
global adoption of its CAR-T therapy. With analyst forecasts pointing to
significant upside, a robust pipeline, and accelerating financial performance,
Legend Biotech offers compelling long-term potential. For investors seeking
innovation-driven growth at a reasonable valuation, Legend Biotech remains a
promising opportunity in the healthcare sector.
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