Amarin (AMRN) shocked Wall Street last month. As a brief recap, the fish oil drug maker released promising data from a highly anticipated study of its leading product Vascepa. Not only did Vascepa result in 25% relative risk reduction of a major cardiovascular event, but its safety profile was also deemed similar to that other other omega-3 fatty acids. In other words, Amarin broke the fish oil code, and its stock tripled in response. Immediately thereafter, AMRN got a slew of upgrades from analysts, along with a number of handsome new price targets.
However, after reaching record highs of $20.50, the stock has been under some pressure giving up roughly 13% of its gain. That said, Cantor analyst Louise Chen believes the rally in Amarin stock is far from over.
Chen noted, “We see no fundamental reason for AMRN’s stock weakness today. Shares are down over 6% while the S&P500 is up 0.1%. We remain positive on AMRN shares ahead of the AHA meeting on 11/10 where we expect the company to release more positive data on the REDUCE-IT study that we think will further reinforce our view that the peak sales potential for Vascepa is still underappreciated. There are two articles being circulated that are driving the concerns today, in our view. #1. Is an article in Forbes, link here. And, #2. Is an article in Stat link here. In short, we think both articles are just headline noise. There is nothing new in either piece, and they do not change our mind on the large market opportunity for AMRN’s Vascepa.”
As such, Chen reiterates an Overweight rating on AMRN with a price target of $35, which implies an upside of 96% from current levels. (To watch Chen’s track record, click here)
Net net, the analyst echoes the predominant bullish vote from the Street on the fish oil drug maker, considering TipRanks analytics reveal AMRN as a Strong Buy. Out of 3 analysts polled in the last 3 months, all 3 are bullish on Amarin stock. With a return potential of 31%, the stock’s consensus target price stands at $23.33. (See AMRN’s price targets and analyst ratings on TipRanks)