Scotiabank Upgrades Sarepta Therapeutics (LSE:0L35)

On June 6, 2025, Scotiabank upgraded Sarepta Therapeutics (LSE:0L35) to Sector Outperform, with an average analyst price target of 94.26 GBX/share, suggesting a potential 119.34% upside. Sarepta is projected to increase annual revenue by 55.82% to 3,480MM and achieve a non-GAAP EPS of 13.02; however, institutional ownership decreased by 2.21% in the last quarter, despite an increase of 28.74% in average portfolio weight dedicated to the stock.

Analysis

Scotiabank's upgrade of Sarepta Therapeutics (LSE:0L35) to 'Sector Outperform' on June 6, 2025, highlights a significant analyst-projected upside, with an average one-year price target of 94.26 GBX per share suggesting a 119.34% increase from its latest reported closing price of 42.97 GBX. This positive outlook is underpinned by projections for a substantial 55.82% rise in annual revenue to 3,480MM and a projected annual non-GAAP EPS of 13.02. However, institutional ownership data presents a more complex scenario. While the average portfolio weight of funds dedicated to Sarepta (0L35) increased by 28.74% to 0.19%, the number of institutional owners declined by 6.37% (64 owners) in the last quarter, and total shares owned by institutions decreased by 2.21% to 111,356K. Notably, several major institutional investors, including Capital International Investors (decreased portfolio allocation by 42.76% despite a 4.01% increase in shares), Janus Henderson Group (decreased shares by 28.63% and allocation by 83.96%), and GROWTH FUND OF AMERICA (decreased shares by 0.09% and allocation by 17.90%), have significantly reduced their portfolio allocations to Sarepta, indicating a cautious repositioning among some large holders despite the bullish analyst sentiment and growth forecasts.

Key Decisions for Investors

• Investors should acknowledge the strong analyst upgrade and substantial price target upside for Sarepta Therapeutics, driven by robust projected revenue and earnings growth.
• Carefully evaluate the mixed signals from institutional investors, where a decrease in the number of owners and total institutional shares contrasts with an increased average portfolio weight among remaining holders, but critically note the significant reduction in portfolio allocation by several key funds.
• Consider weighing the company's high-growth narrative and positive financial projections against the observed institutional repositioning, which warrants further investigation into the rationale behind these allocation shifts.
• Monitor upcoming earnings releases and subsequent institutional ownership data closely to validate Sarepta's growth trajectory and to gauge evolving market sentiment and conviction.