Summary

  • Bluebird bio’s share price surged 19.8% as it received a rating upgrade from BofA Securities.
  • BofA upgraded Bluebird from ‘neutral’ to ‘buy’ as the broker expects Bluebird’s lovo-cel therapy to draw in sales worth US$1 billion.
  • The consensus mean price target on BLUE is US$7.30, which depicts a massive upside potential of 98.91% over Wednesday’s closing price.

Bluebird bio (NASDAQ: BLUE) received a rating upgrade from BofA Securities, leading to an uptick in the biotech company’s shares. BLUE shares recorded a 19.8% rise following BofA’s release of a rating upgrade.

Bluebird is a biotech firm engaged in developing gene therapy for genetic and rare diseases. The gene therapy aims to modify the cells of a patient to correct the underlying cause of the genetic disease. It generates revenue through research fees, license fees, and grants.

EODHD/Others data suggests that the mean recommendation rating on BLUE is 2.6 on a scale of one to five. Here, one represents ‘strong buy’ rating and five represents ‘strong sell’ rating’.

Thirteen analysts have covered the stock, of which two analysts believe it is a ‘strong buy’ and three analysts believe it is a ‘moderate buy.’ Meanwhile, six analysts recommend holding the stock and two analysts recommend selling the stock.

Image source: ©2023 Kalkine®; Data source: EODHD/Others

BofA forecasts gene therapy sales approaching US$1 billion

Broker BofA expects bluebird to lead in the sickle cell gene therapy market, a segment with attractive potential.

One of the primary reasons for the upgrade is the timely receipt of the US regulatory approval of bluebird’s gene therapy lovo-cel in sickle cell by December. Sickle cell disease causes a shortage of healthy blood cells, which restricts blood circulation and causes pain to patients.

BofA believes that the company’s lovo-cel therapy launch could draw in sales worth US$1 billion and could be a “prove it” event for the company. Alongside that, the company has also launched three gene therapy products.

BofA upgraded Bluebird to ‘buy’ from ‘neutral’ and raised its price target on the stock from US$6 to US$10. So, an upside potential of 172.48% exists over BLUE’s closing price on Wednesday, as per BofA’s price target on the stock.

Are other analysts bullish on the stock?

EODHD/Others data suggests that the consensus mean price target on the stock is US$7.30, which depicts a massive upside potential of 98.91% over Wednesday’s closing price.

Raymond James upgraded BLUE to an ‘outperform’ rating on June 21, 2023, with a price target of US$10 on the stock. Alternatively, William Blair and Wells Fargo downgraded the stock to ‘hold’ during late June. However, Wells Fargo remained bullish on the stock and maintained a price target of US$8.

Meanwhile, the company’s revenue also went up during the March 2023 quarter. Bluebird bio reported a total net revenue of US$2.4 million for the quarter, as against US$1.9 million for the March 2022 quarter. Its net income also increased to US$21.2 million in Q1 2023 from a net loss of US$122.2 million in Q1 2022.

BLUE Price Chart; Image Source: BLUE EODHD/Others

BLUE closed at US$3.67 on Wednesday, July 19, 2023. The stock hit its 52-week high of US$8.58 on December 5, 2022.