ADMA Stock Catapults 275.7% in a Year: How Should You Play the Stock?

Core Viewpoint - ADMA Biologics has experienced a significant stock price increase of 275.7% over the past year, contrasting with a 14.3% decline in the industry, driven by strong quarterly performance and raised guidance [1][3]. Company Performance - ADMA Biologics specializes in plasma-derived biologics for treating immune deficiencies and preventing certain infectious diseases, with three FDA-approved products: Bivigam, Asceniv, and Nabi-HB [4]. - The lead product, Asceniv, is a plasma-derived IVIG that contains polyclonal antibodies, indicated for treating primary immunodeficiency disease (PIDD) in adults and adolescents [5]. Financial Highlights - Total revenues in the third quarter increased by 78%, attributed to higher sales of Asceniv and third-party plasma sales from ADMA's BioCenters [6]. - ADMA has raised its revenue guidance for 2024 to over $415 million and for 2025 to over $465 million, with net income projections exceeding $120 million in 2024 and $165 million in 2025 [9]. Product Development - ADMA is conducting a pediatric study for Asceniv, which may lead to label expansion to include pediatric patients, with a potential application filing expected in the coming quarters [7][8]. Margin and Valuation - The higher-margin product portfolio now constitutes over 50% of total revenues, with plans to increase Asceniv's supply, potentially enhancing margins and earnings growth [10]. - ADMA's shares currently trade at a price/sales ratio of 8.86x forward sales, significantly higher than the industry average of 1.69x [11]. Market Outlook - The market for plasma-derived products has substantial growth potential, particularly in the underserved immune-compromised patient population [14].