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Axsome Therapeutics - >>> 3 “Strong Buy” Stocks Trading at Steep Discounts


TipRanks

August 2, 2021


https://finance.yahoo.com/news/3-strong-buy-stocks-trading-142616588.html


How do you define a stock market opportunity? Is it a windfall, a piece of luck, or the result of careful planning, a strategy to make the most of any opening? The savvy investor seeks out the latter, looking for stocks that offer inducements to entry, be it a high upside or a depressed share price or a recent positive analyst review – or better yet, a combination of all three.

So there’s a profile. We’ve used the TipRanks database to look up three stocks that fit it – stocks with Strong Buy consensus ratings, plenty of upside potential, and recent thumbs up from the analyst corps. And, while these stocks have plenty of positives in the profile, each one has also seen steep share price losses in recent weeks. Let's take a closer look.


Axsome Therapeutics (AXSM)

We’ll start with Axsome, a biopharma research company working on new medication therapies for diseases of the central nervous system (CNS). Axsome’s target conditions currently have limited treatment options – and also have a deep potential patient base. The company is researching medications with ‘novel mechanisms of action’ as a way to transform the approach to CNS treatment. The company is investigating treatments for a varied range of conditions, from Alzheimer’s, to fibromyalgia, to severe migraines, to depression.

Axsome currently has four drug candidates in the development pipeline. The leading candidate, AXS-05, is a multimodal treatment, developed to treat major depressive disorder, Alzheimer’s-related agitation, and smoking cessation. The depressive disorder track, for which AXS-05 has a breakthrough therapy designation, is farthest along – the New Drug Application has been submitted, and the FDA has given a PDUFA target date of August 22 this year. If approved, the company plans to launch commercially in 4Q21. On the Alzheimer’s track, AXS-05 is currently undergoing the Phase 3, double-blind ACCORD study. Enrollment is currently ongoing.

The next big update for the company is planned NDA submission for AXS-14, a new treatment for fibromyalgia. This drug candidate has competed two trials, a Phase 2 with 267 patients and a Phase 3 with 1,122 patients, both with positive results. Data from the trials will be included in the NDA submission, which is planned for Q4 of 2022.

Finally, Axsome has AXS-7 as a migraine treatment. This candidate has demonstrated effective pain relief in patients within two hours of dosing, and has a potential patient base of 37 million. The company has an NDA in preparation for this drug candidate, and hopes for approval next year.

The pipeline is the key point here, and Berenberg’s Esther Hong bases her Buy rating on the potential of AXS-05 as a treatment for major depressive disorder.

“We are bullish on the prospects and see a potential commercial launch in Q4 2021. Second, the company expects to submit a new drug application (NDA) with the FDA this quarter for a second product (AXS-07 for the treatment of migraine). Approval could come in 2022. We see opportunity for significant price appreciation over the remainder of the year driven by these key upcoming catalysts with longer-term upside from a robust pipeline,” Hong opined.

The analyst added, "We are bullish on the prospects for AXS-05 in MDD due to 1) its robust efficacy in treating depression as a result of its novel mechanism of action [MOA]; 2) the speed of efficacy compared to traditional antidepressants; and 3) a superior safety profile compared to other NMDA antagonist antidepressants..."

Hong puts a $112 price target on the stock, suggesting an upside of 123% for the year ahead. (To watch Hong’s track record, click here)

With a unanimous Strong Buy consensus rating, based on 8 recent reviews, it’s clear that Wall Street agrees with Hong on the potential of this stock. The shares fell in the past year, mainly due to regulator hurdles, but in the Street’s estimation, that has opened up an opportunity. The stock is selling for $50.27 and has an average target of $135.33, indicating room for ~170% upside potential this year. (See AXSM stock analysis on TipRanks)

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