This biotech stock is a buy despite bearish view from BofA Securities

Regeneron Pharmaceuticals Inc (NASDAQ: REGN) was a notable beneficiary of the global pandemic that resulted in a 30% increase in its stock price last year. But BofA Securities warns 2022 will be a very different story.

Meacham sees downside to $575 a share

In a note on Wednesday, analyst Geoff Meacham downgraded Regeneron to “underperform” with a price target of $575 that represents a 7.0% downside from where the stock closed its previous session. Previously, he had a PT of $675 on REGN.

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Now that Regeneron’s antibody cocktail has been shown to be less effective against Omicron, Meacham doesn’t expect it to be much accretive to the company’s top line this year.

The oncology pipeline, he added, could also take years before it starts to boost revenue. Lastly, he expects the biotech firm’s Eylea and Dupixent drugs to face headwinds this year. Meacham wrote:

Indeed, the impact from a high dose formulation (phase 3 data 2H22e) of Eylea on life-cycle management is unclear, and new competitive threats in both atopic dermatitis (JAKs, lebrikizumab, etc.) and asthma (tezepelumab) could weigh on Dupixent demand as well.

Cramer strongly disagrees with the bearish call

In contrast, Jim Cramer says Regeneron is a buy at current levels. Disagreeing strongly with the bearish call on CNBC’s “Squawk on the Street”, he said:

Meacham has all along said that Regeneron is not going to be the next great company. He’s been wrong. I think his view on Eylea and Dupixent will be wrong too. The stock trades at a very low multiple and is a buy. I think it’s a great company.

According to Cramer, Regeneron is much more than its COVID-19 antibody cocktail and doesn’t see its lower efficacy against Omicron as a reason to sell the stock.