UPDATE: JMP Securities Reiterates on Depomed Following Acquisition of Migraine Asset

In a report published Wednesday, JMP Securities analyst Jason N. Butler reiterated a Market Outperform rating on

, and raised the price target from $10.00 to $11.00. In the report, JMP Securities noted, “Acquisition of migraine asset makes strategic and financial sense; reiterate Market Outperform rating and increasing price target from $10 to $11 on Depomed, Inc. Yesterday, Depomed announced the acquisition of CAMBIA, a formulation of the NSAID diclofenac approved for the treatment of migraine. Depomed will pay Nautilus Neurosciences $48.7MM upfront to acquire the product, representing ~2.7x the current annualized sales run rate, and stated that the transaction is expected to be immediately accretive. We view the product as a good strategic fit for Depomed, leveraging the company's established neurology-focused sales organization. We have updated our model to include sales of CAMBIA, which increases our 2014 and 2015 revenue estimates by 23% and 21%, respectively. We are increasing our price target from $10 to $11, now including CAMBIA in our sum-of-the-parts NPV analysis.” Depomed closed on Tuesday at $8.34.