Euronext Brussels: Retirement with Galapagos


November 3, 2023
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While the risk appetite on the stock exchanges continues to increase, the fat savings account of biotech player Galapagos is particularly popular in Brussels.

On Friday it will be another biotech company’s turn to be in the spotlight. Galapagos

is experiencing its best day since January with a climb of 6 percent, and no less than 13 percent since Monday. Then J&J veteran Paul Stoffels took the helm at the Mechelen biotech company.

The reason is a quarterly update with two encouraging messages to investors. Galapagos shared new research data (in phase 1/2) from its oncology and immunology pipeline. That is the focus of Galapagos 2.0 after the American hangover surrounding the rheumatism and crohn’s drug Jyseleca. Earlier this week, Galapagos announced that it will divest Jyseleca to Alfasigma, an Italian player.

The new oncology data on blood and lymph node cancers shows that eleven out of twelve patients responded to treatment with the molecule GLPG5201. With GPLG5101, another candidate, eleven out of thirteen patients responded.

“The data comes from a limited number of patients with different types of cancers,” says David Seynnaeve, analyst at Degroof Petercam. ‘It is too early to draw conclusions about the therapeutic potential of these agents. The road to the market remains long and especially the lymphatic cancer segment is already relatively crowded,” he says.

The road to market remains long and the lymphatic cancer segment is already relatively crowded.

David Seynnaeve

Analyst Degroof Petercam

Galapagos’ savings account is much more popular than the early research. The company’s strong bank account, which contains no less than 3.8 billion euros in cash, yields a nice pocket money thanks to the increased market interest rates. In the first nine months of 2023, Galapagos received 54.6 million euros in interest, almost the entire net profit of the company and a multiple of last year’s 3.4 million euros.

Investors can buy that cash at a steep discount. Galapagos’ stock market value is 2.3 billion euros, 40 percent below the value of its bank account. That cash is of course one moving target. This year, the people of Mechelen expect to burn approximately 400 million euros in cash,

“In any case, the bank account carries the bulk of our appreciation for Galapagos,” says Seynnaeve. He gives a price target of 44 euros, good for almost 30 percent upside potential. But because few real price triggers from the pipeline are expected in the short term, the advice remains ‘hold’.


KBC Securities analyst Wim Hoste continues to find Solvay ‘very attractive’ at its current valuation. He repeats his buy recommendation and price target of 155 euros, which offers more than 50 percent upside potential compared to the last closing price of 101.30 euros. “We believe the split of the company into two is an important catalyst to unlock shareholder value,” Hoste said. That split will take place on December 11. Another investor day will follow on November 13 to further specify the plans.

Solvay loses 2 percent to 98.2 euros.



(+0.2% to 71.4 euros) receives little support for a seventh share buyback program. The holding company around the Frère family announced additional share buybacks worth 500 million euros on Thursday evening, in the hope of eliminating the persistent stock market discount.

But that approach is counterproductive, thinks analyst Kris Kippers of Degroof Petercam. “Repurchasing shares mechanically increases the intrinsic value per share,” says Kippers. ‘If the intrinsic value per share rises while the share price lags behind, as has been the case with GBL for some time, the stock market discount will only increase.’

Kippers estimates the intrinsic value at GBL at 109 euros per share, which represents a stock market discount of 34 percent. Historically, the stock market discount at GBL has been much lower, around 28 percent.

‘GBL proved this with its two most recent purchases, Affidea (a specialist in cancer care and chemotherapy, ed.) and Sanoptis (a specialist in ophthalmology, ed.), that it can add value and spot opportunities in this market,” says Kippers. ‘But we are not fans of this new share buyback.’

The article is in Dutch


Tags: Euronext Brussels Retirement Galapagos


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