4 Hot Analyst Reads For Monday, July 16th

Bret Jensen

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We kick off a new trading week as second quarter earnings season begins in earnest. The Trump-Putin summit in Helsinki will probably dominate headlines today and the calendar is very light as far as conferences, PDUFA dates and trial milestones as we highlighted yesterday.

With that, here are four small cap stocks seeing notable analyst commentary just before we open the first trading day of the week.

Adamas Pharmaceuticals (ADMS) gets initiated as a new Buy today over at H.C. Wainwright. That analyst firm's analyst has a $45 price target on the stock and provided the following commentary behind his new rating

“Valuation methodology, risks and uncertainties. We have utilized a discounted cash flow (DCF)-based approach to derive a composite valuation assessment of Adamas, which ascribes value to the company’s two principal product opportunities— GOCOVRI and ADS-5102—while also accounting for the token value provided by the royalty stream from Allergan plc on two other controlled-release products, for treatment of moderate-to-severe Alzheimer’s disease (AD).”

Vericel (VCEL) gets upgraded to a new Buy from Neutral over at Ladenburg this morning with a new $13 price target. The small cap is seeing some recent positive analyst commentary. BTIG reissued their Buy rating and $17 price target on VCEL on July 6th with the following color that was heavy on views about a competitor

“In our coverage of the cartilage repair sector, focus has primarily been on the knees as both MACI by Histogenics (HSGX, Buy, $5 PT) are either currently or expected to treat cartilage lesions of the knee. Articular cartilage exists in a variety of joints beyond the knee including the ankles, shoulders, hips, elbows, spine, and hands & wrists offering potential growth opportunities for companies that are able to replicate cartilage in other parts of the body. Foot & Ankle Society conference Boston we explore the opportunity for cartilage repair in the ankle (i.e. talus bone) via autologous cell therapy as we note clinician researchers have previously dabbled with Vericel’s MACI in various case studies.”

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The stock has had a big climb in 2018, although it has seen a substantial pull back recently coinciding with a $65 capital raise via a secondary offering.

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Barclays places a new Overweight rating and $50 price target on European based Cellectis (CLLS) before the bell today. This 'off the radar' name gets relatively sparse coverage in the States despite an approximate ~$1.2 billion market cap. On June 12th, Oppenheimer raised their price target on Cellectis to $44 from $40 previously after the FDA granted a new IND filing for the company. Oppenheimer maintained its Outperform rating on the stock as well.

Finally, Sol-Gel Technologies (SLGL) also gets initiated at H.C. Wainwright early this morning as a new Buy rating with a $14 price target. Here are the details behind Wainwright's bullish view

“Valuation methodology, risks and uncertainties. We have valued Sol-Gel based on a composite assessment of the company’s most advanced clinical-stage drugs. Underlying this, we employ a discounted cash flow (DCF)-based analysis that culminates in a risk-adjusted net present value (rNPV) valuation for each of these agents. This yields a value of $102M for TWIN, assuming a 50% probability of success, and a $323M valuation for VERED, assuming a 60% probability of success. The generic ivermectin cream program contributes a value of $7M to our composite assessment.”

And those are four small and mid cap concerns seeing recent analyst activity before the market opens this Monday. Happy Hunting.

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