On Tuesday, B.Riley maintained a positive outlook on Geron (NASDAQ:GERN) Corporation (NASDAQ:GERN) shares, reaffirming a Buy rating and a price target of $5.50. The firm expects Geron to unveil its third-quarter earnings on November 7, before market opening, with significant investor interest focused on the sales performance of Rytelo and the factors contributing to the stock's recent decline.
The analyst from B.Riley highlighted that, based on patient data from July and IQVIA prescription trends, market expectations for Rytelo are to reach "low $20M" for its first full quarter of sales.
B.Riley's own sales estimate for Rytelo in the third quarter, after accounting for possible gross-to-net discounts, stands at $22.5 million. This figure is slightly higher than the current sell-side consensus of $18.9 million. If sales meet or exceed their estimate, B.Riley believes investors should take it as a positive indication.
The recent drop in Geron's stock price is thought to be due to unfounded worries over initial Rytelo sales figures or the absence of news regarding the European Union’s Committee for Medicinal Products for Human Use (CHMP) opinion on Rytelo. The analyst expressed the belief that these concerns are exaggerated and views the present situation as an enhanced buying opportunity in anticipation of the upcoming earnings report.
B.Riley underscored the favorable trend in Rytelo’s launch trajectory, which is seen as supportive of their long-term commercial outlook for the product. The firm's commentary suggests a strong belief in the potential success of Rytelo and Geron Corporation's prospects leading up to the third-quarter financial results.
In other recent news, Geron Corporation reported strong earnings and revenue results, thanks to the successful launch of its new drug, Rytelo. Analyst firms Goldman Sachs (NYSE:GS) and Leerink Partners have reaffirmed their Buy and Outperform ratings on the company respectively, citing Rytelo's potential to reach global peak sales of $1.2 billion and $1.4 billion in the United States. These ratings are based on strong early adoption trends and anticipated full quarter sales.
In addition to these financial highlights, Geron Corporation has undergone strategic changes with the appointment of Jim Ziegler as Executive Vice President and Chief Commercial Officer. His extensive experience in the biopharmaceutical industry is expected to enhance Geron's commercial strategy, particularly for Rytelo.
Geron Corporation is also engaged in a Phase 3 clinical trial for imetelstat in relapsed/refractory myelofibrosis, further solidifying its focus on blood cancer treatments. The company's financial position remains robust, with $430 million in cash and equivalents, and projected operating expenses for 2024 estimated between $270 million and $280 million. These recent developments underscore Geron's commitment to growth and innovation in its field.
InvestingPro Insights
As Geron Corporation (NASDAQ:GERN) approaches its third-quarter earnings release, InvestingPro data and tips provide additional context to B.Riley's optimistic outlook. Despite the recent stock price decline noted in the article, InvestingPro Tips reveal that Geron has delivered a strong return over the last year, with a 117.03% price total return. This aligns with B.Riley's view that the current dip may present a buying opportunity.
The company's financial health appears solid, with InvestingPro data showing that Geron holds more cash than debt on its balance sheet, and its liquid assets exceed short-term obligations. This financial stability could be crucial as the company ramps up sales of Rytelo.
However, investors should note that Geron is not currently profitable, with a negative P/E ratio of -10.85 for the last twelve months as of Q2 2024. This underscores the importance of Rytelo's sales performance in the upcoming earnings report, as highlighted in the article.
For those seeking a deeper analysis, InvestingPro offers 12 additional tips for Geron Corporation, providing a more comprehensive view of the company's financial position and market performance.
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