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Fly News Breaks for January 21, 2016
ALKS
Jan 21, 2016 | 10:05 EDT
Cowen analyst Ken Cacciatore downgraded Alkermes to Market Perform from Outperform after the company announced that two Phase 3 studies from its ALKS 5461 program for depression missed their endpoints. After removing ALKS 5461 from his model and adjusting his discount rate to reflect increased pipeline uncertainty, the analyst arrived at a $50 price target, down from this previous target of $80. The stock is down $22.60, or 37%, to $37.81 in early trading. The Alkermes product portfolio now holds only "potentially modestly impactful assets," Cacciatore tells investors in a research note. The value of the company's residual royalties as well as Vivitrol and the recently launched Aristada yield a share price of $35-$40 per share, the analyst writes. Cacciatore believes Alkermes could be worth $50 per share to a strategic. At this time he sees better investments elsewhere.
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