On Wednesday, Fennec Pharmaceuticals Inc. (NASDAQ:FENC) shares experienced a revision in its outlook. H.C. Wainwright has lowered its price target for the company to $15.00, a decrease from the previous $18.00. Despite this adjustment, the firm continues to endorse a Buy rating for the pharmaceutical company's shares.
Fennec Pharmaceuticals disclosed its financial results for the first quarter of 2024 on Tuesday. The company's product sales fell short of expectations, reaching only $7.4 million compared to the anticipated $10.6 million. This also marked a decrease from the $9.7 million reported in the final quarter of 2023.
The company's lower than expected sales have been attributed to various factors. One significant issue is the ongoing competition Fennec faces from compounded formulations of sodium thiosulfate (STS), which are being used as substitutes for PEDMARK, Fennec's primary marketed product.
Despite these challenges, H.C. Wainwright reaffirms its Buy rating for Fennec Pharmaceuticals. The revised 12-month price target of $15 reflects a more conservative estimate of the U.S. revenue growth and a reduced projection for the peak sales of PEDMARK. The firm's outlook suggests a tempered yet still positive view of the company's potential performance over the coming year.
InvestingPro Insights
Following the release of Fennec Pharmaceuticals' financial results, investors are keen to understand the company's position and potential. According to real-time data from InvestingPro, Fennec Pharmaceuticals has a market capitalization of $200.51 million and an impressive gross profit margin of 94.08% for the last twelve months as of Q4 2023. This high margin is indicative of the company's ability to manage its cost of goods sold effectively.
An InvestingPro Tip highlights that analysts expect net income and sales growth for Fennec Pharmaceuticals in the current year. This aligns with the company's efforts to overcome the competition from compounded formulations of STS. Despite recent setbacks, the anticipation of profitability and growth could be a signal for potential investors. Another tip to consider is that the stock is currently in oversold territory according to the Relative Strength Index (RSI), which may suggest a potential rebound in the near future.
For those interested in further analysis and additional InvestingPro Tips, there are 10 more tips available for Fennec Pharmaceuticals. To explore these insights, consider subscribing to InvestingPro using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. This could be an invaluable tool for investors looking to make informed decisions about their investments in the pharmaceutical sector.
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