Roth Capital Raises Price Target On EnteroMedics Following FDA Panel Recommendation


In a research note issued today, Roth Capital analyst Chris Lewis reiterated a Buy rating and boosted his price target on EnteroMedics Inc. (ETRM) to $5.00 (from $3.00) following FDA’s Gastroenterology-Urology Device Advisory Panel, which voted that the benefits of ETRM’s Maestro System outweigh the risks by a margin of 6 to 2 (1 abstention). On safety, the panel voted 8 to 1 in favor of ETRM, and on efficacy, the vote was 4 to 5 against ETRM.

“The panel reaffirmed our thesis that ETRM offers a less invasive and safer, yet effective, treatment for the large and under-treated obese population. Many of the physician panelists labeled the Maestro System as a much needed “tool in the toolbox” to address a large gap within the obesity treatment paradigm. Maestro’s proven safety profile and lack of required anatomic changes, particularly versus the current bariatric surgical options (or lack thereof), supported the device’s favorable risk-benefit profile throughout the panel. At this point, we have maintained our current financial projections as we wait for the potential FDA approval. However, given the positive panel recommendation, likelihood for FDA approval, and enhanced commercial opportunity and strategic value, we have increased our target price to $5, from $3”, said Lewis.

According to TipRanks, which measures analysts and bloggers success rate based on how their calls perform, analyst Chris Lewis, who covers ETRM, currently has a one-year average return of 1% and a 50% success rate. He is ranked #2651 out of 3112 analysts.

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