Needham Doubles Cempra Price Target Ahead Of Solithromycin Phase 3 Results


In a research report sent to investors today, Needham analyst Alan Carr maintained a Buy rating on Cempra (NASDAQ:CEMP) and raised his price target to $28 (from $14), which represents a potential upside of 28% from where the stock is currently trading.

Carr noted, “Cempra is expected to announce results from the first of two Phase 3 trials of solithromycin in Community Acquired Bacterial Pneumonia in 1Q15. We expect a positive outcome, based on microbiological, preclinical, and prior clinical data. Cempra announced completion of trial enrollment at 860 patients in late Sept 2014.”

The analyst added, “We reiterate our BUY and are raising our price target in anticipation of favorable Phase 3 results. Our $28 target is based on 25x our 2020 $3.36 EPS estimate, discounted 25% annually. We believe solithromycin has over $2B in global peak sales potential.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Alan Carr has a total average return of 41.4% and a 68.0% success rate. Carr has a -3.3% average return when recommending CEMP, and is ranked #9 out of 3423 analysts.

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