BTIG Thinks Obalon Therapeutics Inc’s Stock is Going to Recover


In a report issued on May 11, Sean Lavin from BTIG maintained a Buy rating on Obalon Therapeutics Inc (NASDAQ: OBLN), with a price target of $5. The company’s shares closed on Friday at $2.85, close to its 52-week low of $2.75.

Lavin wrote:

“Is A Sinking Lead Balloon; PT to $5 OBLN’s 1Q18 results were well below expectations. Revenue of $1.3M was down Y/Y and below both BTIG/Consensus expectations which called for revenue of $3.1M and $3.5M respectively. Mgmt. was unable to fully articulate the cause but we think much of the impact stemmed from heavy stocking in 4Q17 leading to smaller demand for overall orders in 1Q18. Since we can’t understand why docs would stock (when balloons can be delivered quickly) it makes us wonder if there was discounting at year end. What is odd to us is that OBLN is growing accounts, new patients, and the social media/marketing funnel appears strong but we are not certain why this is not translating into greater revenue. That said, Q2 appears to be off to a better start with reorder revenue in April exceeding all of 1Q.”

According to TipRanks.com, Lavin is a 5-star analyst with an average return of 14.9% and a 63.8% success rate. Lavin covers the Healthcare sector, focusing on stocks such as Tactile Systems Technology, Boston Scientific Corp, and Varian Medical Systems.

Obalon Therapeutics Inc has an analyst consensus of Moderate Buy, with a price target consensus of $5.25.

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The company has a one-year high of $11.95 and a one-year low of $2.75. Currently, Obalon Therapeutics Inc has an average volume of 73.03K.

Based on the recent corporate insider activity of 14 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of OBLN in relation to earlier this year.

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Obalon Therapeutics, Inc. focuses on developing and commercializing medical devices to treat obese and overweight people by facilitating weight loss. Its product includes medical balloon technology for weight loss therapy which consists of a capsule containing a balloon that is swallowed and then remotely inflated.

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