SIGA Technologies - Entering a crucial period for business outlook

SIGA Technologies reported another year of top-line growth in FY24, with performance weighted to Q4, driven by material TPOXX deliveries to both domestic and international markets. Product revenue grew 2% y-o-y to $133.3m (albeit lower than our estimate of $155.6m), with Q4 contributing 60% to sales, led by $51.2m in deliveries under the July 2024 BARDA option exercise. Another highlight in Q4 was the regulatory approval in Japan in late 2024 and $11m recorded in international sales, possibly related to deliveries to Japan's Strategic National Stockpile (SNS). With a $70m order book, FY25 should be another successful year, with longer-term potential to be shaped by a new contract win from the US government. We update our estimates to reflect the sales outlook and latest net cash, offset partially by the increased uncertainty introduced by the mpox trial data. Our valuation adjusts to $14.41/share from $13.93/share previously.

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