H.C. Wainwright Reiterates Buy On RXi Pharmaceuticals Following 2Q14 Update

In a research note published today, H.C. Wainwright analyst Reni Benjamin reiterated a Buy rating on shares of RXi Pharmaceuticals (RXII) with a $9 price target, following the company’s second-quarter update. RXi reported a 2Q14 net loss of ($3.2) MM, or ($0.23) per share, exceeding Benjamin’s estimate of ($2.4) MM, or ($0.17) per share. RXi’s grant based revenue of $12,000 was less than Benjamin’s estimate of $29,000. Overall operational losses of ($2.0) MM were comparable to Benjamin’s estimate of ($2.3) MM for the quarter. 

The analyst noted, “The company has three Phase 2 clinical studies on going with the potential to report preliminary data in hypertrophic scarring and earlobe keloids over the next 4-6 months. With a strong proprietary platform technology focused on anti-scarring and ophthalmologic applications, a de-risked lead asset with the potential to enter multiple therapeutic areas, and a cash position of $11.9 MM, we believe RXi Pharmaceuticals represents an undervalued player with significant upside for the longterm investor.”

Benjamin continued, “With the acquisition of the OPKO Healthportfolio, RXi is exploring RNAi as a therapeutic strategy in proliferative vitreoretinopathy (PVR) and potentially expanding to other retinopathies. In May, RXi recently reported the effects of RXI-109 in the eyes of cynomolgus monkeys. Following intravitreal injections of RXI-109, CTGF protein levels decreased in a dose-dependent manner in both retinas and corneas. In our opinion, these results highlight the potential of the company’s nascent ophthalmology program.”

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 -16.5% average return when recommending RXII, and is ranked #2095 out of 3242 analysts.

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