Clovis Oncology Inc CLVS 1.02% investors certainly have reason to be excited about the potential of the company’s Rubraca cancer treatment drug. However, Oppenheimer analyst Leah Cann isn’t quite so excited about Clovis stock at its current price. On Thursday, Oppenheimer initiated coverage of Clovis with a Perform rating.
Clovis shares are up an incredible 607 percent in the past year, including a 57 percent gain since June 15. The market enthusiasm came after the company reported positive late-stage data on Rubraca.
The DNA-damage repair inhibitor drug class is an exciting new area of exploration in the biotech world, Cann said. Rubraca receives accelerated approval from the FDA back in December for treatment of third-line, BRCA mutant positive ovarian cancer, but it is also currently being tested for potential treatment of other ovarian, breast and prostate cancers as well.
While the drug’s potential is huge, Clovis shares already reflect a reasonable valuation for Rubraca, Cann said. Oppenheimer estimates that Clovis will be able to ride the Rubraca wave to 67.3 percent compound annual revenue growth over the next four years, reaching $691.6 million by 2021.
“Using our 2021 estimated revenue of $691.6 million, and applying the average forward price-to-sales of the biotechnology sector of 12.5x, then discounting our estimated revenue for risk of failure, we arrive…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
