Analyst Explains Why They Downgraded Their Rating on Bluebird Bio (BLUE)

William Blair analyst Raju Prasad downgraded Bluebird Bio (BLUEResearch Report) to Hold today. The company’s shares closed on Friday at $125.23.

Prasad said:

“We are taking a conservative view on the company’s transition from a development-stage company to a commercial-stage company . Notably , based on the reimbursement model (costs amortized over five years), we believe that the Zynteglo launch is likely to be a slow mover (we now model $8.7 million in 2020, $32.8 million in 2021, and $79.6 million in 2022) and applying this reimbursement model to sickle cell disease and CALD (with more measured launch estimates) has decreased our fair value estimates for these indications.”

According to TipRanks.com, Prasad is a 5-star analyst with an average return of 15.3% and a 53.6% success rate. Prasad covers the Healthcare sector, focusing on stocks such as Rocket Pharmaceuticals Inc, Global Blood Therapeutics, and Allogene Therapeutics Inc.

Bluebird Bio has an analyst consensus of Moderate Buy, with a price target consensus of $149.88, implying a 19.7% upside from current levels. In a report issued on August 6, Morgan Stanley also maintained a Hold rating on the stock with a $136 price target.

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The company has a one-year high of $176.55 and a one-year low of $87.49. Currently, Bluebird Bio has an average volume of 561.2K.

Based on the recent corporate insider activity of 73 insiders, corporate insider sentiment is neutral on the stock. Most recently, in May 2019, Jason Cole, the Chief Operating and of BLUE bought 562 shares for a total of $28,387.

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bluebird bio, Inc. is a clinical-stage biotechnology company, which engages in the development of potential gene therapies for severe genetic diseases and cancer. Its integrated product platform includes gene therapy, cancer immunotherapy, and gene editing. Its product pipeline includes Lenti-D, LentiGlobin, BCL11a shRNA, bb2121, and bb21217.