MannKind Corporation ׁ(MNKD) Stock Falls on Analyst Downgrade
In a research report released today, Piper Jaffray analyst Joshua Schimmer downgraded shares of MannKind Corporation (NASDAQ:MNKD) from Perform to Underperform rating, while also slashing the price target to $1.50 (from $4.00), which implies a downside of 63% from current levels. MannKind shares reacted to the rating and price target decreases, dropping 9.09% to $3.70, making it among the top losers in pre-market today.
Schimmer wrote, “We recently provided an outlook for MNKD, highlighting the importance of the Afrezza launch for the company’s financial prospects and share price. The launch has been much more disappointing than we expected, and checks with specialists suggest no easy fix. While experience has been fine so far, the diabetes market is extremely complex with multiple moving parts. The complexity limits patient and specialist bandwidth for cumbersome products, and Afrezza is indeed cumbersome. There is some pushback from payors but this doesn’t sound like an insurmountable hurdle that’s meaningfully curtailed adoption.”
Furthermore, “MNKD continues to struggle with its convertible notes, high spending, and eventual obligation to SNY for Afrezza under its 35/65 split. The company has a loan agreement from SNY for $175M due in 2024 (or sooner if the product is returned). The ongoing weakness in Afrezza may drag shares lower and make it harder to finance operations without substantial dilution.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Joshua Schimmer has a total average return of 4.5% and a 46.7% success rate. Schimmer has a -3.1% average return when recommending MNKD, and is ranked #835 out of 3752 analysts.
Out of the 8 analysts polled by TipRanks, 3 rate MannKind Corporation stock a Buy, 3 rate the stock a Hold and 2 recommend to Sell. With a return potential of 83%, the stock’s consensus target price stands at $7.46.