Amgen and Vertex price targets raised at Jefferies ahead of 1Q earnings
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Jefferies has raised the price targets of Amgen (NASDAQ:AMGN) and Vertex Pharma (NASDAQ:VRTX) ahead of their Q1 financials scheduled for later this month as the analysts cite a broader shift into under-appreciated and inexpensive large biotechs in a rising rate environment amid growth-to-value rotation. 
The analyst Michael Yee noted that the consensus estimates for Amgen (AMGN) for the next several years âare generally too low,â as he raised the price target to $295 from $280 per share.
âWe view AMGN as a lower-risk, lower-beta, higher visibility biotech that should move higher and benefit if the biotech sector sees a more positive rotation of money flow,â Yee wrote, reiterating the Buy rating on the stock.
The firm predicts Amgen (AMGN) could reaffirm its 2022 guidance despite a possible Q1 earnings beat driven by higher revenues, better cost management, and increased share repurchases.
âWe think VRTX could become the fastest-growing large-cap biotech due to the companyâs âtriple pillâ regimens,â Yee noted on Vertex (VRTX), referring to the companyâs triple combination therapies for cystic fibrosis.
The investors have not adequately appreciated its therapeutic pipeline, the analyst added, highlighting strong data readouts likely for stem cell-derived allogeneic therapy, VX-880 in Type 1 diabetes, and VX-147 in APOL1 broad kidney disease.
Yee projects Vertex (VRTX) to exceed forecasts for CF revenue in 1Q 2022 and the management to raise revenue guidance for the company by $100 million. However, Jefferies reaffirms the Buy rating on the stock, and the price target raised to $335 from $275 per share implies a premium of ~16% to the last close.
Despite the bullish remarks, both Amgen (AMGN) and Vertex (VRTX) are currently trading lower on Monday in solidarity with a broader selloff among biotech stocks.