If all goes well, the company will have a drug on the market that could bring in billions of dollars in revenue.
Vera Therapeutics (VERA +13.25%) was a standout in the biotech sector on Wednesday. Its stock closed that trading session 13% higher, thanks in no small part to a bullish new note published by an analyst that morning.
A huge potential market
The prognosticator behind the positive note was Cantor Fitzgerald’s Pete Stavropoulos, who reiterated his existing overweight (read: buy) recommendation and $100 per share price target on Vera’s stock. Even after Wednesday’s rise, that level is more than three times the company’s current share price.
Image source: Getty Images.
According to reports, Stavropoulos believes Vera is still loaded with potential due to the company’s progress in developing a treatment for IgA Nephropathy (IgAN; also known as Berger’s disease), a serious kidney ailment that can lead to organ failure.
The analyst believes IgAN is a potentially multi-billion-dollar market, so if Vera successfully brings a drug to pharmacy shelves, it could earn significant revenue. In his estimation, the patient population of the U.S. ranges from 85,000 to 151,000 individuals.
Today’s Change
(13.25%) $3.90
Current Price
$33.33
Key Data Points
Market Cap
$2B
Day’s Range
$28.81 – $34.07
52wk Range
$18.53 – $51.27
Volume
3.2M
Avg Vol
1.5M
Gross Margin
0.00%
Dividend Yield
N/A
Promising development
As ever with biotechs, I must caution that buying them is always risky — after all, they tend to be boom-or-bust investments dependent on their development cycles. With that in mind, Vera appears to have above-average chances, given that the IgAN program has progressed significantly and the addressable market is substantial.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.