Thursday’s Market Insights: Keryx Biopharmaceuticals (KERX), Caterpillar Inc. (CAT), Arrowhead Research Corp (ARWR), Conatus Pharmaceuticals Inc (CNAT)

Keryx Biopharmaceuticals (NASDAQ:KERX) rose more than 12% in pre-market trading up to $4.40 after this morning’s announcement that the company received approval in Europe for Fexeric(R). The therapy was approved by the European Commissions for broad use, including in adults with chronic kidney disease (CKD), including both dialysis and pre-dialysis patients. The drug is already approved in the U.S. by the FDA under the name Auryxia. As of this writing, 7 analysts on TipRanks have weighed in on Keryx in the last 3 months. Of the 7 analysts, 4 are bullish on the company and 3 are neutral. The average 12-month price target on the stock is $14.50, marking a 270% potential upside from where the stock last closed.

Caterpillar Inc. (NYSE:CAT) slipped 2.64% in pre-market trading down to $68.35 after Axiom analyst Gordon Johnson initiated coverage on the company will a Sell rating a $28 price target; less than half of the current share price. The firm points to overdone risk in the 2016 estimate figures, specifically EPS estimates, and believes that the company’s third business unit “appears to be rolling over,” while the other two are declining. Johnson added, “We see a structural deterioration in the company’s ability to employ leverage to fund sales, where revenue is recognized, between itself and wholly- owned foreign subsidiaries (i.e., channel stuffing), for which we believe there is no off taker at the end of the transaction.” He also notes that the company’s practice of using debt to finance transactions is becoming unsustainable. Johnson concluded, “…one cannot create demand out of thin air, and schemes of this nature, while at times long in cycle, always end in tears.”

Click here to see Gordon Johnson’s past ratings and performance history

Arrowhead Research Corp (NASDAQ:ARWR) climbed more than 36% in pre-market trading up to $9.18 after the biotechnology company announced new data for its pipeline drug, ARC-520, aimed to treat hepatitis B. In this morning’s announcement, the company highlighted that ARC-520 achieved significant HBV s-Antigen (HBsAg) reduction of up to 99% in humans. Furthermore, multi-dose studies conducted in chimpanzees also demonstrated peak reduction of HBsAg up to 99.8%. The drug was well-tolerated in both humans and chimpanzees. Arrowhead CEO, Christopher Anzalone, commented, “We have achieved the highest knockdown ever reported in humans with RNAi and a safety profile that continues to be excellent. We are optimistic that this will ultimately translate into powerful clinical outcomes for ARC-520…” As of this writing, only one analyst on TipRanks has rated the company in the last 3 months. Michael Yee of RBC Capital gave the stock a Sector Perform rating last month, commenting, “ARWR is one player in Hep B but we think the stand-alone RNAi drug ARC-520 won’t be enough to tackle Hep B alone and a multifactorial combination approach will be needed, including one targeting cccDNA more directly.”

Click here to see Michael Yee’s past ratings and performance history

Conatus Pharmaceuticals Inc (NASDAQ:CNAT) soared more than 23% in pre-market trading up to $7.10 after the biotechnology company released new trial results yesterday, after market close. Conatus announced top-line results from Phase 2 trials of emricasan in patients with Portal Hypertension (PH) and liver cirrhosis. The trial met its primary endpoints in lowering the hepatic venous pressure gradient (HVPG); a measurement of pressure in the portal veins and in lowering Cytokeratin 18; a biomarker that is associated with chronic inflammation. The study enrolled 23 patients across 9 sites in the United States. Just prior to this announcement, analyst Ed Arce of HC Wainwright initiated coverage on the company with a Buy rating a $15 price target, noting that emricasan has “disease modifying potential.” According to the 3 analysts polled by TipRanks in the last 3 months, all of them are bullish on the company with an average 12-month price target of $14.67.

Click here to see Ed Arce’s past ratings and performance history

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