On Friday, H.C. Wainwright reaffirmed its Buy rating on shares of Veru Inc. (NASDAQ: NASDAQ:VERU), with a price target maintained at $3.00. Currently trading at $0.63 with a market cap of $92 million, InvestingPro data shows the company maintains a WEAK financial health score.
The endorsement follows Veru's recent announcement of its financial outcomes for the fiscal year ending September 30, 2024. The company reported net revenues of $16.9 million, indicating a year-over-year growth of 4%, which surpassed analyst projections of $13.2 million.
The net loss stood at $37.8 million, or ($0.28) per share, which was more favorable than the estimated loss of $40.6 million. According to InvestingPro, while Veru holds more cash than debt on its balance sheet with a healthy current ratio of 2.97x, the company is quickly burning through its cash reserves.
Veru's management has provided updates on their clinical trials, specifically the ongoing Phase 2b trial of enobosarm. This trial is focused on preventing muscle loss and promoting fat loss in combination with Wegovy (semaglutide) for the treatment of sarcopenic obesity. According to the company, the trial is progressing as planned, with expectations to release topline data for the primary endpoint of lean body mass in January 2025.
In addition to the ongoing trial, Veru anticipates results from a separate blinded Phase 2b extension trial in the second quarter of 2025. The outcomes of these trials are particularly significant as they could lead to a potential partnership before enobosarm moves into a pivotal program for obesity treatment.
H.C. Wainwright's analyst expressed continued confidence in the potential of enobosarm, noting that positive results from the Phase 2b trial could be instrumental for Veru in securing a partnership. The firm's reiterated Buy rating and $3 price target reflect the analyst's optimistic expectations for Veru's clinical developments and their potential impact on the company's growth trajectory.
InvestingPro analysis suggests the stock is slightly undervalued, with analyst targets ranging from $1 to $5. Subscribers can access 10+ additional ProTips and comprehensive financial metrics in the Pro Research Report.
In other recent news, Veru Inc. has made significant strides in its clinical trials and corporate developments. The company's presentation at ObesityWeek showcased a meta-analysis of results from four placebo-controlled Phase 2 and 3 clinical studies, underscoring the consistent efficacy of its investigational drug, enobosarm.
The forthcoming Phase 2b QUALITY trial, set to evaluate the effects of enobosarm in obese or overweight individuals, is anticipated to yield top line results in January.
In terms of corporate changes, Veru Inc. has amended the forbearance and payment terms of its loan agreements with Onconetix, Inc. The revised terms extend the forbearance period and alter the payment structure for two promissory notes totaling $10 million.
Moreover, Veru Inc. has been notified of potential delisting from Nasdaq due to non-compliance with the exchange's minimum bid price rule, with a deadline until February 2025 to regain compliance.
The company has also witnessed changes in analyst ratings. Oppenheimer maintains a $5 target on Veru with a positive outlook, while Jefferies revised its price target for Veru from $1.20 to $1.00, maintaining a Hold rating. Veru has also expanded its Board of Directors with the appointment of Loren Mark Katzovitz and is currently conducting a Phase IIB clinical trial led by obesity expert Dr. Steven B. Heymsfield.
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