Julie Lamb

About the Author Julie Lamb

Julie graduated with a Bachelor of Arts in English with a focus on creative writing from the University of Louisville.

Friday’s Market Insights: Cerulean Pharma Inc (CERU), Pernix Therapeutics Holdings Inc (PTX) and GoPro Inc (GPRO)

Cerulean Pharma Inc (NASDAQ:CERU) are catapulting 60% after the cancer drug-maker has decided to confront recent missteps with the consideration of M&A possibilities.

Though the firm’s board of directors notes a deal is not guaranteed upon review of prospective “strategic alternatives,” a sale of the company or merger into larger firm, an option to invest in the company, or even a licensed assets sale are options all currently on the table. With investment bank Aquilo Partners hired on as CERU’s financial advisor, the firm is carefully considering every angle.

Investors are encouraged by the news in light of August’s stumbling block when CERU’s lead drug candidate CRLX-101, designed to treat liver cancer, in combination with Avastin failed to meet statistical significance in the treatment of patients with advanced renal cell carcinoma (RCC). The Phase II failure resulted in a 58% reduction in Cerulean’s workforce to secure savings of $5 million a year.

CERU closed September with $38.1 million in cash and equivalents, an amount the firm believes will enable operational funding comfortably through the next year.

TipRanks analytics indicate CERU as a Buy. Based on two analysts polled by TipRanks in the last 3 months, 1 rates a Buy on CERU while 1 maintains a Hold. The 12-month average price target stands at $3.75, marking a nearly 152% upside from where the shares last closed.

Pernix Therapeutics Holdings Inc (NASDAQ:PTX) shares are taking an 18% plunge after the specialty pharmaceutical company revealed an update on its arbitration with GlaxoSmithKline. The two firms have been locked in claims circling the migraine drug Treximet asset purchase agreement and supply agreement.

On January 31st, the ruling went the way of GSK, where the tribunal insisted GSK win roughly $35 million in fees and damages as well as $2 to $5 million in interest. Pernix had claimed GSK violated supply agreement obligations, which the tribunal rebuffed. Offsetting the total award owed, the firm has paid a collective $16.5 million into GSK’s escrow account at this time, and will be working with GSK to review the remaining interest.

As of yesterday, following the mandated payment of interest and principal regarding Treximet secured notes, Pernix’s unaudited cash balance stood squaring $26 million. Moving forward, the company will look into acquisition possibilities and aim to undertake refinancing options.

Additionally, TipRanks analytics reveals that Difey Yang of Aegis, Akiva Felt of Oppenheimer, and Serge Belanger of Needham all rate a Hold on PTX stock.

GoPro Inc (NASDAQ:GPRO) shares are sinking 12% in the wake of a disappointing fourth-quarter print that sent investors scrambling.

What caused the quarterly aftershock specifically? Not only did fourth-quarter sales fail to impress, but the GPRO management team has decided to pull revenue outlook for the financial year of 2017. This cannot bode well for a company who struggled with a Karma drone recall during the holiday season.

For the fourth quarter, the action camera giant posted $541 million in sales, a gaping miss considering the Street had called for $576 million. The company reported EPS of $0.16 as well as a GAAP loss of $116 million, or $0.82 loss per diluted share. Whereas the Street had expected gross margins to hit 39.6%, in reality, GPRO’s margins never quite reached at 39.5%. Clearly the Karma drone’s lack of profits left a mark on the print, and not a positive one. GPRO management has guided sales for the first quarter of 2017 to $200M, with an added or detracted $10 million.

CEO Nicholas Woodman has tried to focus on the positive, contending, “In 2016, big investments in hardware, cloud, and mobile yielded a solid foundational experience for our customers.”

TipRanks analytics demonstrate GPRO as a Sell. Out of 16 analysts polled by TipRanks in the last 3 months, 1 is bullish on GoPro stock, 8 remain sidelined, and 7 are bearish on the stock. With a loss potential of nearly 9%, the stock’s consensus target price stands at $8.78.

Stay Ahead of Everyone Else

Get The Latest Stock News Alerts