Kalkine has a fully transformed New Avatar.

small-cap

One Pharmaceuticals Stock Trading Near Resistance Levels - NEU

Nov 03, 2023 | Team Kalkine
One Pharmaceuticals Stock Trading Near Resistance Levels - NEU

 

Neuren Pharmaceuticals Limited (ASX: NEU)

NEU is engaged in the development of new drug therapies targeting the treatment of neurological disorders. Approved by the US FDA, the company’s product DAYBUE™ (trofinetide) is designed for treat Rett syndrome in adult and pediatric patients two years of age and older.

Recommendation Rationale – SELL at AUD 13.92

  • Financial Performance: Total income included AUD 62.9mn in revenue in 1HFY23, from DAYBUE™ (trofinetide), which was launched by Acadia in April this year in the US. The company also advanced studies focused on NNZ-2591, being designed for four serious neurodevelopmental disorders. Cash generated from operations in Q3FY23 stood at AUD 135mn. Cash as at 30 September 2023, came in at AUD 230mn.
  • Outlook: NEU is focused on realising value from its share in trofinetide through Acadia’s commercialisation of DAYBUE™ in the US and through its expanded global partnership with Acadia.
  • Emerging Risks: NEU is subject to risks arising from delays in clinical trials which might hamper the planned next phases of drug development.
  • Overvalued Multiples: On a forward 12-month basis, key valuation multiples (EV/EBITDA, EV/Sales, Price/Earnings, Price/Book Value and Price/Cash Flow) are higher than the median of Healthcare Industry.

NEU Daily Chart

Considering that the stock has surpassed its R2 level, target level achievement, current trading levels, sharp rally in share price movement, and risks associated, it is prudent to book at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current price of AUD 13.92 (as of November 3, 2023, at 10:55 AM AEDT).

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is November 3, 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.


Disclaimer - This report has been issued by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and prepared by Kalkine and its related bodies corporate authorised to provide general financial product advice. Kalkine.com.au and associated pages are published by Kalkine.

Any advice provided in this report is general advice only and does not take into account your objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Statement or other offer document for the securities or other financial products referred to in Kalkine reports. You should obtain a copy of the relevant Product Disclosure Statement, Information Statement or offer document and consider the statement or document before making any decision about whether to acquire the security or product.

You should also seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice in this report or on the Kalkine website. Not all investments are appropriate for all people.

The information in this report and on the Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of information contained in its reports, newsletters and websites. All information represents our views at the date of publication and may change without notice.

Kalkine does not guarantee the performance of, or returns on, any investment. To the extent permitted by law, Kalkine excludes all liability for any loss or damage arising from the use of this report, the Kalkine website and any information published on the Kalkine website (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine hereby limits its liability, to the extent permitted by law, to the resupply of services. Please note past performance is neither an indicator nor a guarantee of future performance.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this report or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website including entities covered in this Report.