Analysts upgrading estimates for pharma stock
Time to Acquire Aquestive?
There may be good news for Aquestive Therapeutics, Inc., a pharmaceutical company that advances and commercializes medicines to solve critical therapeutic problems, especially those of the central nervous system (CNS), using drug delivery technology and scientific expertise to redesign important medicines. The revenue forecast for 2021 has undergone a big change, with analysts now much more upbeat on its sales pipeline and investors also optimistic, with the stock up 14 percent to US$3.71 in early August.
After the upgrade, six analysts have predicted revenues of US$48m in 2021. This would be a solid 15 percent increase on its sales over the past year. The analysts expect losses to be contained, “narrowing 11 percent from last year to US$1.63,” according to Simply Wall Street. Prior to this consensus update, the analysts had been predicting revenues of US$40m and losses of US$1.68 per share in 2021. Now the analysts are projecting a major upgrade to 2021's revenue estimates, while also reducing their loss estimates.
Still, the analysts reduced their price target 5.7 percent to US$13.83, implying that the ongoing losses are likely to have a negative impact on Aquestive’s valuation. The most bullish projection is US$28.00, and the most bearish is US$7.00 per share. The consensus price is an average, reflecting divergent views.
Aquestive’s rate of growth is projected to accelerate considerably, with revenues expected to exhibit 32 percent growth to the end of 2021 on an annualized basis. That represents a change from its decline of 14 percent a year in the past three years. Other companies in the industry are projected to see their revenue grow 3.7 percent per year, so Aquestive Therapeutics is likely to grow faster than its competitors.
Analysts seem to think that Aquestive is moving towards profitability, estimating highr revenues and growing sales. There was a reduction in the price target and dilutive stock issuance.
Aquestive recently reported financial results for the second quarter ended June 30, 2021, and provided an update on recent developments in its business. According to Keith Kendall, Chief Executive Officer of Aquestive, “We continue to make progress, as committed, on the key value drivers for Aquestive. The FDA has accepted for filing the NDA for Libervant and assigned a PDUFA target goal date of December 23, 2021. We are in active dialogue with the FDA and remain focused on bringing our non-invasive and innovative product to the underserved population of patients with refractory epilepsy. Enrollment in the Phase 1 PK study for AQST-109, a potential oral alternative to injectable epinephrine such as EpiPen®, is progressing well and we are on track to report top-line data as promised in the second half of 2021. Moreover, Sympazan and our other on-going business activities generated solid operating results during the first half of 2021. As a result, we have raised our full year revenue expectations and continued to strengthen our capital position. And, finally, we strengthened the management team by adding in June a permanent, experienced CFO in Ernie Toth.”