Leerink Swann Lowers Sucampo Pharmaceuticals (SCMP) Valuation To $6 - $7
March 16, 2010 8:05 AM
Leerink Swann analysts Gary Nachman and Andrew Finkelstein reiterated their Outperform rating for shares of Sucampo Pharmaceuticals, Inc. (Nasdaq: SCMP) and lowered valuation of the company's shares to $6 - $7 per share.
The analysts said that there were uncertainties in the Sucampo Pharmaceuticals pipeline but that it was undervalued.
Nachman and Finkelstein wrote that Amitiza had already become a meaningful GI product and could see even more upside.
"Last night, SCMP reported 4Q operating results modestly better than expected, and gave general updates regarding activities on a number of fronts. Revenue of $16.3MM was essentially in line with our $16.2MM and consensus' $16.9MM estimates, with royalties on Amitiza ($11.0MM) above our estimate ($9.7MM). EPS of $0.03 beat consensus' $0.01E but trailed our $0.04E because of tax. We have limited visibility on 2010, with many important strategic activities lacking defined timelines, and SCMP declining to give financial guidance. Significantly, SCMP filed for arbitration over Takeda's alleged failure to properly support Amitiza. Terminating the deal could allow SCMP to better realize value LT, though there are clearly risks and potentially significant NT costs."
