Dewey Steadman at research firm Canaccord has come out with a bullish call on shares of Aerie Pharmaceuticals Inc (NASDAQ:AERI). The analyst assumed coverage on AERI with a Buy rating and a price target of $50, which implies a potential upside of 34% from where the stock is currently trading.
As far as commercial and clinical potential, Steadman sees Aerie as “well-positioned,” noting, “Aerie is one of two notable companies developing novel drugs that work on the eye’s trabecular meshwork (TM) to reduce intraocular pressure (IOP) in glaucoma. We believe that Aerie’s mechanism of action, coupled with a high switch rate and low treatment success in glaucoma, can lead to significant market potential for Aerie’s Rhopressa monotherapy and Roclatan combination therapy.”
Though the analyst recognizes rivalry from biotech firm Inotek in the spectrum of glaucoma therapy, he believes that is all the better for the field and will not ultimately act as an undoing threat for Aerie. Steadman explains, “With a high level of discontinuation, switching and combination therapy within the glaucoma space, we don’t see Aerie and Inotek […] in a winner-take-all competition. We believe the market is large enough to support both companies’ products, especially since both feature novel and different mechanisms to act on the yet-to-be-addressed TM pathway.”
Competitor Inotek is anticipated to report top-line data form its MATrX-1 trial the first week of the new year. “We believe both companies can succeed in the space and investors should purchase AERI shares on any MATrX-1- related weakness,” Steadman contends, believing that Aerie shares could see a rise if Inotek’s data read-out results as negative or reveals a safety signals.
TipRanks analytics exhibit AERI as a Strong Buy, with all 6 analysts polled by TipRanks in the last 3 months bullish on the stock. The 12-month average price target stands at $56.33, marking a 51% upside from where the shares last closed.
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