SPCEO1 wrote: There really was no rationale and how could there be? Nothing is going on at THTX that even remotely justifies such a price target cut. He, and/or his Canaccord bosses, are no doubt just ticked off he did not get the lead on the January share offering nor the ATM. It is just Wall Street doing its vindicitive thing.
Again, I think you are too extreme in your negative thoughts on NASH. But, pushing that aside for now, the big problem he faced was his absurdly high sales estimates for THTX. He brought these down without really mentioning it, a common approach for analysts when they are embarrassingly wrong. But his boss likely said, "look, if you are reducing your sales estimates by so much you can't keep such a high price target." He is assuming a 15% royalty rate on NASH an a one year delay on testing and sales starting.
The analysts covering THTX have been missing the mark for a long time but I have some sympathy for some of them as THTX has been missing the mark a lot too. But today's action by Canaccord was likely mostly payback for not appointing them the lead manager on the deals follwoing a couple of years of positive coverage and might even be meant to help undermine the eventual positive report that Cantor likely will come out with. Wall Street can be a very nasty place at times.
Here is the justification from the report:
"We are lowering our rating from Buy to HOLD on shares of THTX and decreasing our
12-month price target from $8 to $3 to reflect the company’s latest financial results
and business updates. We estimate that the launch of tesamorelin for the treatment
of NASH in the U.S. market will be postponed initially for one year to 2H26. Moreover,
we have changed our revenue build projections for tesamorelin to be based on a 15%
back-end royalty on net sales to reflect the strategy change in seeking partnership in
the late-stage development and commercialization of tesamorelin in NASH. Accordingly,
we also decreased our projections for R&D and SG&A for the rest of 2021 to reflect a
later initiation of the NASH Phase III trial."
qwerty22 wrote: If somebody could copy and paste a big chunk of his rationale?
If that 8 bucks in some way was an attempt to represent the potential in NASH then there is good reason for the downgrade. The company giving up on their own internal program and narrowing the path forward to just partnership is a significant negative development. He is going to have to rebuild value through cancer.
But it does feel like the company has signed up for some charity program for bewildered analysts, they are all completely all over the place on what thtx actually is. Is it somebody's job the corral them?
Wino115 wrote:
Yawn...Eddie only cares about NASH and isn't broad enough to add in other biotechs or cover oncology. His industry is in the doldrums and now NASH is further off and Cantor, who gets the oncology side, jumped in and has actual clients -they are now banking front runners. He was clueless on cancer developments. His firm is being sold and he needs to figure out a new future. But it is one more broker they've managed to piss off.
SABBOBCAT wrote: Sounds like good old Dubuc burned another bridge...