Tuesday, Oppenheimer maintained its Outperform rating on Savara (NASDAQ:SVRA) with a steady price target of $15.00 despite a minor earnings shortfall. Savara's earnings per share (EPS) were reported at ($0.12), slightly below the anticipated ($0.10) forecasted by both Oppenheimer and consensus estimates. Oppenheimer highlighted that Savara is not currently focused on earnings, emphasizing the clinical progress instead.
The firm expressed satisfaction with Savara's recent clinical results, including the statistically significant change in Diffusing Capacity of the Lungs for Carbon Monoxide (DLCO) at Week-24, with a p-value of 0.0007. Additionally, the treatment's effect showed significant durability at Week 48 (p=0.0008) for DLCO, and the St. George's Respiratory Questionnaire (SGRQ) Total Score also improved at Week-24 (p=0.0072).
Oppenheimer noted Savara's acceleration in commercialization efforts, with management anticipating a Biologics License Application (BLA) submission for MOLBREEVI, the conditionally accepted trade name for molgramostim, in the first half of 2025. The firm recognized the high unmet need in autoimmune pulmonary alveolar proteinosis (aPAP), which affects approximately 3,600 diagnosed patients in the United States.
The robust Phase 3 IMPALA-2 results and Savara's strengthened balance sheet were also cited as reasons for the reiteration of the Outperform rating and the $15 price target. Oppenheimer's stance reflects confidence in Savara's potential and future prospects in addressing aPAP.
In other recent news, Savara Inc. has made significant strides in the biopharmaceutical sector. The company recently announced a $100 million stock offering of 26,246,720 shares at $3.81 each. The transaction, managed by firms such as Jefferies, Piper Sandler, and Guggenheim Securities, is expected to close soon.
In addition to this, Savara has reported positive results from its Phase 3 IMPALA-2 clinical trial for molgramostim, a treatment for autoimmune pulmonary alveolar proteinosis (aPAP). The trial met its primary and secondary endpoints, showing significant improvement in patients.
Several analyst firms have responded positively to these developments. H.C. Wainwright, and JMP Securities have all maintained favorable ratings for Savara and raised their price targets. Piper Sandler also maintained an Overweight rating and a $16.00 price target on Savara, expressing confidence in the forthcoming IMPALA-2 data results.
InvestingPro Insights
As Savara (NASDAQ:SVRA) continues to focus on clinical advancements over immediate earnings, a glimpse into the company's financial health and market performance through InvestingPro data can provide investors with a broader perspective. With a market capitalization of approximately $674.19 million, Savara's financial position shows that it holds more cash than debt, which can be a reassuring sign for investors concerned about the company's solvency. However, it's important to note that the company's gross profit margins are weak, with a reported gross profit of -$52.33 million in the last twelve months as of Q1 2024.
The stock's performance has seen some volatility, with a 1-month price total return of -16.16%, reflecting recent market reactions. Despite this, Savara's liquid assets exceed its short-term obligations, which suggests a level of financial flexibility in the near term. Analysts, as reflected in the InvestingPro Tips, do not anticipate the company to be profitable this year, with both net income expected to drop and a negative earnings per share (EPS) of -$0.37 in the last twelve months as of Q1 2024.
Investors evaluating Savara's potential may also consider the company's high Price/Book multiple of 5.53. While this could indicate a premium market valuation, it is also a reminder of the company's non-profitability over the last twelve months. For those interested in a deeper dive into the company's prospects, there are 9 additional InvestingPro Tips available, which can offer further insights into Savara's performance and outlook.
As for the future, the anticipated Biologics License Application submission for MOLBREEVI is a significant milestone to watch. The InvestingPro Fair Value estimate of $3.83, alongside the analyst target of $10, may serve as reference points for investors as they assess the potential risk and reward of investing in Savara amidst its clinical developments and market performance.
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