UPDATE: Credit Suisse Initiates Outperform, $7 PT on XenoPort; Valuation Trumps Fundamental Concerns

Credit Suisse initiates its coverage on XenoPort

with an Outperform rating and a price target of $7 per share. Credit Suisse says, "Despite a number of fundamental concerns, at its current valuation ($219mn market cap/$165mn y/e EV) and with low expectations for its marketed products and pipeline, we think relatively little has to go right for the stock price to appreciate. Specifically we see 3 main upside optionality triggers which are not factored into our numbers/valuation (a) delivery of greater Regnite/Horizant revenues - either via high end-user sales and/or US re-partnering (b) monetization of clinical assets, in particular XP23829 or (c) the company seeks strategic alternatives." XNPT closed at $6.07 on Wednesday.