On Tuesday, H.C. Wainwright analyst increased the price target on shares of Verona Pharma (NASDAQ:VRNA) to $60 from the previous target of $42, maintaining a Buy rating on the shares.
The adjustment follows Verona's announcement of its fourth quarter and full-year 2024 financial results, which showcased a notable increase in revenue. According to InvestingPro data, the company has demonstrated remarkable momentum, with a 202% return over the past year and currently trades near its 52-week high of $55.42.
Verona Pharma reported a total of $36 million in net revenue for the fourth quarter of 2024, solely attributed to sales of Ohtuvayre (ensifentrine), its FDA-approved treatment for chronic obstructive pulmonary disease (COPD). The fourth quarter earnings exceeded H.C. Wainwright's forecast of $16.9 million.
Consequently, the company's full-year 2024 net revenue reached approximately $42 million. The company maintains impressive gross profit margins of 90.34% and strong liquidity with a current ratio of 13.03. For deeper insights into VRNA's financial health and growth potential, InvestingPro subscribers have access to over 15 additional key metrics and expert analysis.
The analyst's optimism is further bolstered by the assignment of a unique J-code for Ohtuvayre, J7601, which became effective at the start of January. This is expected to enhance the drug's market penetration. In light of these developments, H.C. Wainwright has revised its full-year 2025 revenue forecast for Verona Pharma to $265 million, a significant increase from the prior estimate of $126.2 million.
The new price target of $60 per American Depositary Share (ADS) reflects not only the updated revenue forecasts but also a lowered discount rate assumption, now at 10% instead of the previous 11%, and a reduced terminal rate of decline, adjusted to 1% from 2%. These changes underscore the firm's confidence in Verona Pharma's financial trajectory and market performance.
In other recent news, Verona Pharma has been the subject of numerous analyst upgrades and positive financial reports. Roth/MKM initiated coverage on Verona Pharma with a Buy rating, highlighting the potential of its drug Ohtuvayre™ and the company's robust financial position. The firm noted Verona Pharma's impressive Q4 sales figures for Ohtuvayre™, which reached $36 million, a 6.4-fold increase over Q3 of the same year.
Truist Securities increased the price target for Verona Pharma's shares to $57.00, maintaining a Buy rating. This followed the company's announcement of Q4 sales for Ohtuvayre, which totaled approximately $36 million, surpassing Truist Securities' estimate of $15.6 million.
BTIG analysts raised Verona Pharma's stock target to $77, noting the early-stage launch of Ohtuvayre and potential for further growth. Verona Pharma reported preliminary fourth-quarter sales of Ohtuvayre that exceeded expectations and a robust financial position with cash and cash equivalents of approximately $400 million.
Lastly, H.C. Wainwright maintained a Buy rating on Verona Pharma shares and raised the price target to $42.00 following strong Q3 financial results. The company reported $5.6 million in top-line revenue for Q3, surpassing the highest Wall Street estimate of $3.5 million, all generated from sales of Ohtuvayre. These are the latest developments in Verona Pharma's journey.
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