H.C. Wainwright Reiterates Buy On La Jolla Following 2Q14 Results; Keeps $20 PT

In a research note released today, H.C. Wainwright analyst Reni Benjamin reiterated a Buy rating on La Jolla Pharmaceutical (LJPC) with a $20 price target, following the company second-quarter results. LJPC reported a 2Q14 net loss of ($4.3) MM, or ($0.63) per share, compared to Benjamin’s estimate of ($5.2) MM, or ($0.53) per share. 

“In 2Q14, the company announced the development of LJPC-501 in Catecholamine Resistant Hypotension (CRH), and is expected to enter a pivotal trial in early 2015. In addition, LJPC-401 remains on track to enter a Phase 1 trial in iron overload disorders later this year. Finally, the company disclosed that it is also developing LJPC-1010, an orally available formulation of GCS-100, in non-alcoholic steatohepatitis (NASH). Based on the clinical profile to date, the portfolio of diverse assets, the potential to secure an ex- US partnership, and a cash position of $56.6 MM, we believe La Jolla Pharmaceutical represents an undervalued player with significant upside for the long-term investor.”, Benjamin noted. 

With regards to the company’s financial position, the analyst noted, “Recently, LJPC completed a secondary offering of approximately 5.4 MM shares at $10.50 per share. In total, the company raised $53.1 MM in net proceeds, which we expect to be used to fund ongoing and future clinical trials. In our opinion, the company has sufficient resources to fund operations until 2H16.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Reni Benjamin has a total average return of 0.5% and a 43.6% success rate. Benjamin has a 3.6% average return when recommending LJPC, and is ranked #2095 out of 3242 analysts.

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