www.smarteranalyst.com/2016/03/31/...inting-financial-results/
Canaccord Slashes Price Target for AEterna Zentaris Inc. (USA) (AEZS) Following Disappointing Financial Results
Canaccord analyst Neil Maruoka expressed a cautious stance today on drug maker AEterna Zentaris Inc. (USA)(NASDAQ:AEZS), after the company reported fourth-quarter financial results that were below his expectations on a lighter top line and higher SG&A expenses. The analyst emphasizes his understanding of looming risks and reduces his price target for the stock to $9.00 (from $13.00), while reiterating a Speculative Buy rating on the stock.
Maruoka commented, Æterna Zentaris has established commercialization agreements for several products in endocrinology and oncology, but the revenue ramp has been slow. While these products are complementary to Æterna Zentaris pipeline, we believe investors should look to Zoptrex and Macrilen as drivers of shareholder value.
The analyst explained the new target noting, We value Æterna Zentaris based on a probability weighted NPV model of its most advanced therapies, using a 15% discount rate and a 45% probability of success for Zoptarelin in endometrial cancer. After updating our model and estimates for the additional common shares issued as part of the most recent equity financing, our target price is reduced to US$9.00, which represents an annualized forecast return of 183% and continues to support our SPECULATIVE BUY rating.