UPDATE: BMO Capital Markets Downgrades Arena Pharmaceuticals to Market Perform, Reiterates $10 PT
In a report published earlier today, BMO Capital Markets downgraded its rating for Arena Pharmaceuticals, Inc. (NASDAQ: ARNA) from Outperform to Market Perform, and reiterated its $10.00 price target.
BMO Capital went on to say “With ARNA shares trading at our target price we believe the stock is fully valued and pricing in timely approval, absence of REMS and low burden of monitoring. Upside potential to our $1.6B global peak sales estimate in 2020 and to our 2017 US sales estimate of $550M is difficult to ascertain, in advance of approval, labeling review and early-market trends, but we would highlight incremental $0.14 EPS for every $100M in incremental sales in our 2017 valuation year. Downside risk to nonapproval is low, in our opinion; however, with 17 of 23 panel members recommending regular monitoring for valvulopathy and with 9 of 23 specifically recommending a REMS or regular ECHO monitoring, downside risk to estimates could emerge.”
Arena Pharmaceuticals, Inc. closed on Friday at $9.88.
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