Maxim Group comments on Inovio Pharmaceuticals (INO) ahead of 'Binary Event'
1.50pm ET 06/18/14 Street Insider
Maxim Group analyst Jason Kolbert weighed in on Inovio Pharmaceuticals (NYSE: INO) ahead of what he called a "binary event."
"We are positive but we can t predict an outcome of a clinical trial," Kolbert comments. "As such we do advise caution into the data results. As a result of the reverse stock split we have adjusted our price target to $18.00 from 6.00. Our Price Target is predicated on good results for VGX-3100 trial. Risk adverse investors should understand we can-not predict the outcome of a binary event."
Commenting on possible outcomes, Kolbert noted: "Good data will lead to a large pivotal trial. We would expect an increase in valuation in proportion to how good the data is, based on P-values around the primary endpoint. If the data is bad and misses the primary and secondary endpoints, we would expect a pullback in the stock to a threshold level. We believe that based on the broad pipeline and the collaborations (especially with Roche: RHHBY-$37.1-NR) that a floor valuation will be established at a modest premium to cash (1.5x to 2.0x). If the data is mixed we would expect it to be a question around clinical trial design, so that with a different trial structure or dosing regimen, that the trial would succeed. In this scenario we would expect the stock to trade at 2x-3x cash value. We have recently adjusted our model for the 4:1 reverse stock split which establishes a new price target of $18.00 per share. Our price target assumes a positive outcome of the current PII trial."
The firm maintained a Buy rating and adjusted their price target to $18.00
For an analyst ratings summary and ratings history on Inovio Pharmaceuticals click here. For more ratings news on Inovio Pharmaceuticals click here.
Shares of Inovio Pharmaceuticals closed at $9.21 yesterday.
