On Thursday, Jones Trading adjusted its outlook on TFF Pharmaceuticals (NASDAQ:TFFP) shares, lowering the 12-month price target significantly to $4.00 from the previous $13.00. Despite this change, the firm maintained a Buy rating on the stock.
The adjustment reflects concerns about the long-term risks associated with TFF Pharmaceuticals' reliance on the development of a single clinical asset, TFF TAC.
The analyst at Jones Trading expressed continued belief in the potential of TFF Pharmaceuticals' formulation technology and the clinical and commercial prospects for TFF TAC. However, the decision to decrease the terminal rate in the discounted cash flow (DCF) analysis from 0% to -15% was made to account for the inherent risks of focusing on one main product.
The report suggests that the perceived risk could diminish as the company progresses with its interactions with the FDA regarding TFF TAC, secures partners or collaborators for another of its products, TFF VORI, and ensures medium-term funding. These steps would also contribute to a reemphasis on the development of the company's pipeline and platform.
The firm reiterated its Buy rating, signaling confidence in the company's future despite the reduced price target. The new target of $4 represents a significant decrease but still implies a positive outlook on the stock's performance over the next year.
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