NEW YORK (TheStreet) -- Shares of Vivus Inc. (VVUS) are down 7.12% to $5.74 after Piper Jaffray downgraded the stock earlier today to "underweight" from "neutral."
The firm cut its price target to $3 from from $8.
While commenting positively on the outlook for the U.S. anti-obesity drug market and positive evidence, Piper Jaffray said for
long-term pharmacoeconomic benefit from treating obesity, these macro-dynamics have not yet appreciably translated to significant gains into Qsymia's prescription and sales trends, in our view ... Given that now nearly three full quarters have transpired post proxy battle and management changes, we have grown increasingly wary on the outlook for Qsymia.
The firm concluded that, "based on our updated view of increased execution risk, we are reducing our out-year Qsymia revenue projections and also increasing our discount rate to 20% (from 15%)."
TheStreet Ratings team rates VIVUS INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate VIVUS INC (VVUS) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, generally disappointing historical performance in the stock itself and generally high debt management risk."