In a research report released Friday, Wedbush analyst Liana Moussatos reiterated an Outperform rating on shares of Xoma Corp (NASDAQ:XOMA), while reducing the price target to $11 (from $13), to reflect the refocused clinical direction, as the company is restructuring and reducing cash burn in the wake of the failed EYEGUARD-B trial.
Moussatos noted, “Xoma refocused its pipeline on the development of XOMA 358 (XMetD) for two rare hyperinsulinemia hypoglycemia diseases. Xoma plans to initiate Phase 2/POC studies in congenital hyperinsulinism (CHI) and post-bariatric surgery hyperinsulinism (PBS) in the coming months. Recall Xoma 358 demonstrated impressive glucose lowering effect in a Phase 1 study.” Furthermore, “The Phase 3 pivotal trial for gevokizumab treatment of pyoderma gangrenosum (PG) appears to be on track. While Xoma is no longer funding the remaining EYEGUARD trials, the trial in PG is still ongoing.”
“Xoma has early-stage drug candidates that could possibly provide undiluted cash. Potential out-licensing of XMetA, an insulin sensitizer for Type 2 Diabetes and Xoma 089, an anti-TGFβ monoclonal antibody for immuno-oncology therapy could provide source of non-dilutive capital in 2015.”, the analyst added.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Liana Moussatos has a total average return of 24.4% and a 41.1% success rate. Moussatos has a -50.3% average return when recommending XOMA, and is ranked #81 out of 3728 analysts.
Out of the 6 analysts polled by TipRanks, 4 rate Xoma stock a Buy, while 2 rate the stock a Hold. With a return potential of 1220%, the stock’s consensus target price stands at $10.17.