Regardless of the delicate financial backdrop, 2022 has nonetheless supplied a number of large-scale takeovers. Microsoft’s acquisition of Activision Blizzard ($68.7 billion – anticipated to shut subsequent yr), Broadcom’s of VMWare (~$61 billion – by the top of subsequent yr, too) and Oracle’s of Cerner ($28.3 billion), are all notable offers that readily come to thoughts.
For firms, a number of the time, bigger is preferable; smaller companies can reap the benefits of cost-savings that bigger organizations have, whereas larger entities get entry to further expertise that allows them to advertise progressive concepts and facilitates additional progress. It’s a win-win state of affairs, as long as the acquirer and goal are the proper match.
So, with 2023 hovering into view, which firms may very well be the following takeover targets? Wall Road’s analysts have pinpointed two names that might doubtlessly be subsequent in line for some acquisitive motion. We’ve opened the TipRanks database to get a fuller image of those firms’ prospects. Let’s see what makes these names red-hot takeover candidates proper now.
Viridian Therapeutics (VRDN)
We’ll begin with Viridian Therapeutics, a biotech firm creating therapies for sufferers affected by TED (thyroid eye illness). The corporate has three packages in varied phases of growth, probably the most superior of those is for VRDN-001, an anti-insulin-like progress factor-1 receptor (IGF-1R) monoclonal antibody.
Halfway by means of final month, the corporate introduced optimistic top-line medical information from the primary two cohorts within the ongoing Part 1/2 medical research of VRDN-001, which confirmed most sufferers exhibited vital enhancements in proptosis and medical exercise rating, and full decision of diplopia following simply two infusions of VRDN-001. The preliminary information additionally implies a lengthened period of profit. Outcomes from the third cohort ought to see the sunshine of day in early January 2023.
The corporate has additionally initiated a worldwide Part 3 research (THRIVE) of VRDN-001, with the primary affected person anticipated to be enrolled in December, and an information readout anticipated by mid-2024.
So, the place does the takeover chat come from? Properly, there appears to be numerous curiosity just lately in Horizon Therapeutics, an organization whose which lead product Tepezza is already authorised for thyroid eye illness (TED) and is on the right track to clock gross sales of ~$2 billion in 2022.
Whereas like Tepezza, VRDN-001 is run intravenously, Oppenheimer analyst Leland Gershell believes the drug has proven potential for “extra speedy medical enchancment, shorter infusions, and an accelerated therapy course.”
Gershell additionally believes the curiosity proven in Horizon “alerts the attractiveness of (and trade conviction in) the TED market’s progress prospects, and will carry VRDN nearer to a possible takeout—whether or not by one of many suitors in discussions with HZNP (AMGN, SNY) or one other firm.”
What’s extra, provides the analyst, VRDN shares nonetheless commerce at a “small fraction of HZNP’s valuation.”
All instructed, then, Gershell charges VRDN shares an Outperform (i.e. Purchase), whereas his $33 worth goal makes room for one-year progress of 23%. (To observe Gershell’s observe file, click on right here)
Viridian will get the Road’s full backing; the inventory has garnered Buys solely – 8, in whole, which all coalesce to a Robust Purchase consensus ranking. The common goal is extra bullish than Gershell will permit; at $40.88, the determine suggests shares will climb ~52% greater within the yr forward. (See VRDN inventory forecast on TipRanks)
Denison Mines (DNN)
The following M&A candidate we’ll have a look at is Denison Mines, a uranium exploration and growth firm. Its pursuits primarily lie within the Athabasca Basin area within the Canadian Prairie province of northern Saskatchewan.
Along with proudly owning a post-closure mine upkeep enterprise and a share within the McClean Lake Uranium Mill, one of many largest uranium processing services on the earth, the corporate additionally has a large assortment of properties, of which the bulk are nonetheless within the early phases of exploration.
Nevertheless, many of the firm’s price is primarily derived from simply two property. One is from the few million kilos of U3O8 Denison bought for considerably much less cash than what spot uranium is at present going for. The second is its Wheeler River Undertaking, which Denison is actively creating and the place it intends to use in situ restoration (“ISR”) strategies to extract very inexpensive uranium.
The Wheeler River Uranium Undertaking, the biggest undeveloped uranium undertaking within the japanese, extremely developed Athabasca Basin area of northern Saskatchewan, is owned by Denison with an efficient 95% stake. It’s this undertaking which Cantor analyst Mike Kozak imagine makes Denison a gorgeous takeover proposition, although that’s not the one cause to get behind the corporate.
“Given the Tier One standing of the Wheeler River undertaking, its high spot on the listing of potential takeover candidates within the uranium sector, and the Firm’s stability sheet which is absolutely cashed-up by means of to building, Denison must be a core holding for any/all institutional traders with a uranium focus, power allocation, or Environmental, Social, and Governance (ESG) standards,” Kozak defined. “The Firm stays our most well-liked uranium developer.”
Kozak just isn’t messing about in his advice; together with a Purchase ranking, his Road-high worth goal of $4.25 suggests DNN shares are at present undervalued to the tune of 279%. (To observe Kozak’s observe file, click on right here)
Some shares make a roundly optimistic impression on Wall Road’s analysts, and Denison is a kind of. This uranium inventory has a unanimous Robust Purchase consensus ranking, primarily based on 6 current optimistic opinions. The shares are priced at $1.12 and the typical worth goal of $2.31 provides the shares ~106% upside potential for the following 12 months. (See DNN inventory forecast on TipRanks)
To search out good concepts for shares buying and selling at engaging valuations, go to TipRanks’ Finest Shares to Purchase, a newly launched device that unites all of TipRanks’ fairness insights.
Disclaimer: The opinions expressed on this article are solely these of the featured analyst. The content material is meant for use for informational functions solely. It is vitally essential to do your individual evaluation earlier than making any funding.
