UBS has upgraded Argenx (EBR:ARGX) to a Buy rating from Neutral and boosted its price target to 1,400 euros from 960 euros, pointing to what the bank describes as a clearer route for Vyvgart, the company's lead therapy, to approach roughly $20 billion in peak annual sales.
The stock reacted positively to the move, trading up 2.8% in Brussels by 08:04 ET (12:04 GMT).
Analyst rationale
Analyst Xian Deng said the rating upgrade reflects stronger-than-anticipated Phase 3 data in myositis and a broader pipeline that UBS considers "underappreciated." As part of the repricing, UBS raised its probability-adjusted peak sales estimate for Vyvgart to $18 billion, a figure it says is roughly 15% higher than consensus forecasts.
The bank has modeled approximately $5.5 billion in adjusted peak sales for myositis subtypes, compared with consensus at $2.6 billion. UBS cites a larger addressable patient population for these subtypes and a relative absence of alternative therapies when comparing Vyvgart's potential use in myositis with its application in chronic inflammatory demyelinating polyneuropathy (CIDP).
Deng also flagged Vyvgart's ongoing Phase 3 trial in Sjogren's syndrome, with a readout anticipated in the second half of 2027. He noted encouraging Phase 2 data across the drug class as a supportive factor for the trial, while also cautioning that, "while clinical trials carry binary risks," existing approved indications together with the de-risked myositis results "provide downside support for the stock."
Pipeline diversification and potential new launches
Beyond Vyvgart, a central element of UBS's upgraded outlook is Argenx's wider development program. Deng expressed "high conviction" in a Phase 3 readout for empasiprubart in multifocal motor neuropathy (MMN), which UBS expects in the fourth quarter of 2026. That optimism follows positive Phase 2 findings and what the analyst characterizes as a favorable trial design.
UBS said a successful empasiprubart outcome would represent the first Argenx product launch not centered on Vyvgart, addressing an investor concern about the company's prior dependence on a single marketed therapy. The bank also pointed to Argenx's recent approximately $2 billion acquisition of Forte, which brought an early-stage anti-CD122 candidate targeting rare diseases such as vitiligo into the company's portfolio. UBS views that deal as a move toward further pipeline diversification.
Valuation and financial assumptions
UBS values Argenx by combining two approaches: a discounted cash flow-based sum-of-the-parts analysis and peer multiples, weighted evenly at 50/50. Deng said that although the bank assumes higher near-term selling, general and administrative (SG&A) expenditures, those costs are more than offset in UBS's model by the higher Vyvgart sales projections, the addition of pipeline assets, and updated peer multiples.
The upgrade reflects UBS's view that stronger late-stage clinical evidence and pipeline breadth justify a higher valuation, while the firm's modeling incorporates both potential upside from new indications and the offsetting effects of increased near-term investment.