Our target price of $213 per share is derived from our discounted cash flow (DCF) analysis in which we project risk-adjusted free cash flows to 2033 and then discount back at 10% annually, applying a 2% terminal growth rate. We utilize a 10% discount rate for all companies in our biotechnology coverage universe with currently approved commercial products that make material revenue contributions in our forecasts.

We rate ASND as High Risk based on the usual volatility of biotech stocks and uncertainty/risk associated with clinical trials and late-stage drug development.

The risks that could prevent Ascendis from achieving our target price are typical of those associated with commercial stage biotechnology stocks. There is top-line risk associated with growth of commercial stage products. Shortfalls could lead to weakness in the shares. Regulatory/clinical risk is associated with each pipeline candidate, clinical shortfalls of its development program including Skytrofa, TransCon PTH, and TransCon CNP, as well as other programs, with negative updates in this area potentially leading to depreciation in share value. Financing risk is also present given the high levels of capital deployed for development. Until sufficient profits are achieved, the company could have to go to market to raise additional funding.