UBS raised its price target for Axsome Therapeutics Inc. common stock to $251 from $248 and reaffirmed a Buy rating after the company released its fourth-quarter fiscal 2025 results. Investors drove the shares lower - down about 4.7% following the earnings disclosure - amid concerns over higher spending tied to an expanded national sales force.
Those investor worries came despite a strong top-line performance: Axsome reported 65.6% revenue growth over the last twelve months, with total revenue reaching $638.5 million. UBS highlighted that the company plans to add roughly 300 sales representatives, and estimated that the fully-loaded cost for those hires would be in the neighborhood of $90 million in full-time employee expenses.
Even with the added commercial expense, UBS noted substantial operating leverage remains within Axsome's profit and loss profile. Supporting that view, InvestingPro data cited by the firm shows the company commanding a gross profit margin of 92.6%, which provides meaningful capacity to absorb incremental selling costs while preserving margin structure. The platform also identifies the stock as undervalued on its Fair Value analysis.
Commercial strategy and prescription dynamics
UBS pointed to historical patterns at Axsome, noting previous sales-force expansions coincided with sizeable volume increases for Auvelity. The firm observed that inflection points in monthly new prescriptions for Auvelity occurred after each prior expansion of the commercial team.
Management has described the planned addition of roughly 300 representatives as appropriately sized for the anticipated ADA launch in the foreseeable future. The company has emphasized that community settings generate 60% of current volume and will remain a primary focus for the commercial effort.
Recent operating results and broader analyst response
Axsome reported Auvelity sales of $155.1 million in the fourth quarter of fiscal 2025, a 14% increase compared with the prior quarter. To support continued uptake of Auvelity in major depressive disorder and to prepare for a potential launch in Alzheimer’s disease agitation (ADA), the company is expanding its sales organization to approximately 600 representatives.
Several other research firms updated their views and targets following the quarterly report. RBC Capital raised its price target to $222 while keeping an Outperform rating. Guggenheim increased its target to $220, citing strong sales performance and strategic commercial expansion. Wolfe Research initiated coverage with an Outperform rating and a $230 price target, calling out the sizable sales growth of Auvelity, which generated approximately $507 million in sales for major depressive disorder in 2025.
Truist Securities reiterated a Buy rating with a $200 price target and specifically referenced the company’s plan to add 300 sales representatives in anticipation of an FDA decision regarding its ADA treatment. These analyst moves reflect the market’s focus on the interplay between near-term investment in commercial resources and revenue trajectory.
Pipeline activity
In parallel with the commercial expansion, Axsome has started dosing the first patient in the CLARITY Phase 3 trial of solriamfetol, targeting major depressive disorder with excessive daytime sleepiness symptoms. The dosing milestone underscores the company’s simultaneous push on both commercial execution and clinical development.
Bottom line
UBS’s modest lift to its price target reflects its view that Axsome retains operating leverage and pricing power despite higher selling expenses needed to scale the sales force. The company’s recent quarter showed accelerating Auvelity sales and robust revenue growth, while other research firms also adjusted ratings and targets amid the company’s push to expand market presence and advance its pipeline.