MLV analyst Vernon Bernardino weighed in today with a few insights on Conatus Pharmaceuticals (NASDAQ:CNAT), following discussions with management during the J.P. Morgan healthcare conference, which took place last week in San Francisco. The analyst rates the stock a Buy with a $16 price target.
Bernardino wrote, “We learned from our discussions with Conatus Pharmaceuticals during the annual January confluence of Wall Street and the healthcare industry in San Francisco, CA, that investors are still confounded by the topline Ph 2 results announced with emricasan on 1/8/15, which were derived from three clinical studies in organ-impaired patients.”
The analyst continued, “We can see the potential for confusion, as the detail, diversity and volume of data presented was a thicket of information to digest. We point to a mechanistic link to disease resolution, in particular, as what gives Conatus data suitable for opening a dialog about next steps with emricasan and the FDA.”
Bottom line, “With the stock down 47% since 1/8, we believe CNAT undervalued ahead of readouts in 2015, which we believe will build ultimately into a robust pool of data sufficient for a decision on the lead liver disease indication to pursue. We therefore reiterate our Buy rating and $16 PT.”