Skip to content

Sarepta a cheap takeout target?

June 9, 2017

Sarepta Therapeutics Inc SRPT 0.6%, a smid-cap biopharmaceutical company that focuses on the treatment of rare neuromuscular diseases including Duchenne muscular dystrophy, saw its stock peak north of $60 per share in late 2016 after the U.S. Food and Drug Administration green-lighted its DMD therapy product Exondys 51 for immediate marketing.

But since then controversial, which turned off some investors and created a high level of short interest, Oppenheimer’s Hartaj Singh commented in a research report. Nevertheless, the company has managed to release encouraging data on the therapy’s effectiveness which may not necessarily be reflected in the stock’s current valuation.

In fact, should Sarepta be acquired at current levels it would be at “bargain” prices, the analyst continued. Specifically, the stock is trading at a 50 to 75 percent discount to recent M&A deals in the space.

A larger company would be able to achieve a return on investment at current valuation levels (plus premium) based on the worldwide Exondys franchise and get the rest of the company for free, Singh emphasized.

“This is an expectation asymmetry we believe should be arbitraged away by investors,” the analyst concluded.


Latest Ratings for SRPT

Date Firm Action From To
Apr 2017 SunTrust Robinson Humphrey Upgrades Hold Buy
Mar 2017 Nomura Initiates Coverage On Buy
Mar 2017 Leerink Swann Upgrades Market Perform Outperform


From → Uncategorized

Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: