Credit Suisse Previews Biogen, Says 'Consensus Tecfidera Downgrades = Pipeline Buying Opportunity'

Credit Suisse on Thursday previewed Biogen Idec Inc BIIB ahead of its fourth-quarter results. Biogen is rated as Outperform with a $400 price target.

In the report, analyst Ravi Mehrota wrote, "Consensus numbers for Tecfidera, in particular longer term > 2017 revenue estimates, have crept up to "sanity check" testing levels and are likely to come down. This could be catalyzed as early as post-market today by Q4 results. In our view, any resulting near-term stock weakness should be used as a buying opportunity as the BIIB pipeline/domain domination theme continues to escalate."

Biogen's deep pipeline allows it to trade at a premium above comparable biotech companies, as earnings estimates do not properly predict the potential of the pipeline, Mehrota argues. However he cautions that, "Fourth quarter results may act as a "course-correction" catalyst for consensus estimates."

Biogen closed Wednesday at 351.18, down 1.87 percent.