Guggenheim's analyst, Michael Schmidt, has adjusted the price target for Revolution Medicines (RVMD, Financial) to $80, a reduction from the previous $87, while maintaining a Buy rating on the stock. This revision follows the company's recent Q1 results and a strategic pipeline update. The update shed light on RVMD's clinical development plans, particularly for their multi-RAS inhibitor, daraxonrasib, and the G12C-selective RAS inhibitor, elironrasib, in treating first-line non-small cell lung cancer.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 11 analysts, the average target price for Revolution Medicines Inc (RVMD, Financial) is $72.55 with a high estimate of $88.00 and a low estimate of $57.00. The average target implies an upside of 92.63% from the current price of $37.66. More detailed estimate data can be found on the Revolution Medicines Inc (RVMD) Forecast page.
Based on the consensus recommendation from 13 brokerage firms, Revolution Medicines Inc's (RVMD, Financial) average brokerage recommendation is currently 1.5, indicating "Buy" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Revolution Medicines Inc (RVMD, Financial) in one year is $0.35, suggesting a downside of 99.07% from the current price of $37.66. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Revolution Medicines Inc (RVMD) Summary page.
RVMD Key Business Developments
Release Date: May 07, 2025
- Cash and Investments: $2.1 billion as of the end of Q1 2025.
- R&D Expenses: $205.7 million for Q1 2025, up from $118 million in Q1 2024.
- G&A Expenses: $35 million for Q1 2025, compared to $22.8 million in Q1 2024.
- Net Loss: $213.4 million for Q1 2025, compared to $116 million in Q1 2024.
- Projected Full Year 2025 GAAP Net Loss: Expected to be between $840 million and $900 million.
- Stock-Based Compensation Expense: Estimated between $115 million and $130 million for 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revolution Medicines Inc (RVMD, Financial) has made significant progress with its RAS(ON) inhibitors, including daraxonrasib, elironrasib, and zoldonrasib, which show promising clinical profiles.
- The company is advancing its Phase 3 RASolute 302 trial for daraxonrasib in pancreatic cancer and plans to initiate two additional Phase 3 studies in the second half of 2025.
- RVMD's strategy for non-small cell lung cancer includes developing RAS(ON) inhibitors as leading therapies across all RAS mutations and lines of therapy.
- The company has a strong financial position with $2.1 billion in cash and investments, projected to fund operations into the second half of 2027.
- RVMD is expanding its commercial and operational capabilities, including the appointment of Anthony Mancini as Chief Global Commercialization Officer to oversee commercialization strategy.
Negative Points
- Research and development expenses increased significantly to $205.7 million in Q1 2025 from $118 million in Q1 2024, primarily due to clinical trial and manufacturing expenses.
- General and administrative expenses also rose to $35 million in Q1 2025 from $22.8 million in Q1 2024, driven by personnel-related expenses and commercial preparation activities.
- The net loss for Q1 2025 was $213.4 million, up from $116 million in Q1 2024, due to higher operating expenses.
- There is still no full regulatory approval for RAS inhibitors in any RAS mutant lung cancer, indicating potential regulatory hurdles.
- The company is in the dose optimization phase for its triplet combination of elironrasib, daraxonrasib, and pembrolizumab, which may delay the initiation of Phase 3 trials.
