Analyst Bullish Towards Depomed Inc (DEPO)
Depomed, Inc. Logo. (PRNewsFoto/Depomed, Inc.)
Analyst Ken Trbovich from Janney Montgomery reiterated his buy rating for Depomed Inc (NASDAQ:DEPO) with a price target of $28, marking a 43% increase from current levels. This came after the company reported in-line revenues of $116.7 million and EPS of $0.27, beating expectations by $0.01. In a move to increase confidence in the company’s heavily-weighted back half, management “announced a 9.9% price increases on its largest products—Nucynta, Nucynta ER and Gralise, which together accounted for 83% of 2Q16 revenues. Although Nucynta prescription growth is strong, management lowered guidance due to lower average dosage per prescription and “negative trends in the broader market for opioid-based products.”
Although the company lowered guidance the analyst feels that “the potential to extend protection from generic entrants to 2025 for Nucynta and 2029 for Nucynta ER represents a major catalyst” for DEPO. The analyst expects to see a ruling that gives DEPO protection for both products through 2025.
According to TipRanks, Trbovich has a success rate of 52% with an average return of 44.4% per recommendation.