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Oppenheimer Sees New Life In 22-Year-Old ArQule Stock

Oppenheimer Sees New Life In 22-Year-Old ArQule Stock

ArQule, Inc. (NASDAQ: ARQL) shares are up 367 percent year-over-year, but they’re still undervalued, according to Oppenheimer.

The Rating

Analyst Hartaj Singh initiated coverage on ArQule with an Outperform rating and $7 price target.

The Thesis

Oppenheimer expects the ARQ 092/751 and ARQ 531 opportunities to each represent $3 per share, with 35-percent certainty of the candidates making it to market, Singh said in the initiation note. (See the analyst's track record here.) 

“We are impressed by the company’s competency in kinase inhibition and experienced management team, and believe that the one-two punch of the company’s rare disease/oncology franchise in ARQ 092/751 (AKT inhibitors) and the blue-skies scenario of the reversible BTK-inhibitor ARQ 531 will create substantial value for shareholders over the near-to-mid-term,” Singh said. 

ARQ 092/751 boasts 2027 sales prospects of $720 million, and ARQ 092 alone is expected to post $150,000 per patient per year — with data-driven upside potential — when it launches domestically in 2022, the analyst said. 

ARQ 531 is estimated to achieve 2026 sales of $730 million.

“With the burgeoning resistance to irreversible BTK inhibitors increasing [...] we believe that reversible BTK inhibition will constitute a $1 billion to $3 billion market opportunity in 2023 and beyond,” Singh said of 531.

Oppenheimer anticipates data on the PK/PD profile of ARQ 531, BTK knockdown and candidate side effects in mid-June.

Price Action

ArQule shares were trading up 1.32 percent at $5.35 at the time of publication Tuesday. 

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Latest Ratings for ARQL

Dec 2019B. RileyDowngradesBuyNeutral
Dec 2019Roth CapitalDowngradesBuyNeutral
Dec 2019Cantor FitzgeraldDowngradesOverweightNeutral

View More Analyst Ratings for ARQL
View the Latest Analyst Ratings


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