NEW YORK (TheStreet) -- Shares of Organovo Holdings (ONVO) - Get Report surged 9.69% to $4.30 in late morning trading Wednesday after Cantor Fitzgerald initiated coverage on the stock with a "buy" rating and a $5 price target.

"We think that Organovo's proprietary bioprinting process could provide disruptive additions to the pharmaceutical toxicology markets near-term," the firm wrote in a research note issued Tuesday.

"Applying a 4.0x market cap/revenue multiple to our estimated FY:21 revenues of $288.3M, discounted 20%, results in our price target of $5," Cantor Fitzgerald continued. "Alternatively, applying a 20x multiple to our FY:21 EPS multiple of $0.81, discounted 20%, also results in a price target of $5."

Organovo designs and creates multi-cellular, dynamic, and functional human tissues for use in drug discovery and medical research.

More than 3.2 million shares had changed hands as of 11:32 a.m., compared to the daily average volume of 1,353,120.

ONVO data by YCharts

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