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HC Wainwright: Buy StemCells, It's Worth $1/Share

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In a report published Monday, HC Wainwright analysts initiated coverage of StemCells Inc (NASDAQ: STEM) with a Buy rating and a price target of $1.

StemCells is carrying out clinical tests to apply its human CNS stem cells platform for developing treatments for CNS disorders. "The company's platform identifies, cultures and purifies adult neural stem cells for allogeneic engraphment, a strategy that we believe may hold the promise of preserving and potentially restoring CNS functions," the analysts mentioned.

Preliminary data from the early trials for treatment for dry age-related macular degeneration (dry AMD) and chronic spinal chord injuries was encouraging. The company is expected to provide further results from its dry AMD trials during June 24-27.

In the report HC Wainwright noted, "Stem cell therapy is an ideal treatment for dry AMD and SCI. Stem cells are characterized by their capacity for cell renewal and differentiation, and hence may be an ideal treatment strategy for targeting indications where replacement of cells and tissues may improve a disorder."

The company's treatment for dry AMD is expected to be received well. "We see dry AMD as the primary value driver with significant unmet need driving strong market adoption and peak sales of $2.5 billion ($5 million in royalty) in 2027—translating to a royalty revenue of $650 million," the analysts added.

StemCells' share price is expected to be driven by the announcement of positive data from the company's clinical trials.

Latest Ratings for STEM

May 2016Maxim GroupDowngradesBuyHold
Apr 2016Rodman & RenshawAssumesBuy
Nov 2015H.C. WainwrightAssumesBuy

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Posted-In: HC WainwrightAnalyst Color Initiation Analyst Ratings


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