PropThink: PBYI Makes a Big Splash on the NYSE; Why all the Excitement?
(Thomson Reuters ONE) -
By Jake King
Puma Biotechnology (NYSE:PBYI) uplisted to the New York Stock Exchange from the
OTC Bulletin Board on Friday, generating significant trading interest in the
stock and a 40% rally. The company was founded by some of the same executives
who built and then sold Cougar Biotechnology for $1B to Johnson and Johnson
(NYSE:JNJ) in 2009. Before noon Friday, more than 1.8M shares had already traded
hands, a stark contrast to the stock's 17,000 average. Puma also increased the
size of its previously announced common stock offering from 6.5M to 7.5M shares
today, priced at $16, with a 1.125M over-allotment for underwriters; the sale
should generate more than $100M after expenses.
Puma is a relatively new cancer-focused drug developer and has only been trading
publicly since April. The company's lead and only compound is PB272 (neratinib),
an oral tyrosine kinase inhibitor being tested as a single agent and in
combinations for metastatic and mutated breast cancer; the drug is in a number
of Phase II trials. If management's track record is any indication, Puma hopes
to find success in-licensing and developing clinically-tested cancer drugs. When
Cougar was sold, the company had three products in late-stage development,
including what is now known commercially as Zytiga; analysts estimate peak sales
of $1B for the prostate cancer drug. The company is accruing significant capital
through the latest stock offering, and may move to acquire another drug in the
near future in order to expand its pipeline
The market is now valuing PBYI at over $450M, a valuation that very few single-
candidate Phase II biotechs attain, and only then through significant analyst
and market vetting. After trading only sporadically for the last six months,
PBYI's action today is largely a result of increased liquidity and momentum due
to the stock's NYSE listing. Friday's gains, while impressive, probably won't be
sustainable for long. Profit-taking will further pressure PBYI in the near-term,
and although interest in the stock should increase, the current $23 share price
is overdone. Leerink Swann and Stifel Nicolaus both initiated coverage of the
company in the last 6 months with price targets of $20 and $19 respectively, and
we agree that a lower share price is more adequate for this young biotech until
the market can more accurately evaluate the business.
Read this article in its original form by clicking here.
About PropThink
PropThink is an intelligence service that delivers long and short trading ideas
to investors in the healthcare and life sciences sectors. Our focus is on
identifying and analyzing technically-complicated companies and equities that
are grossly over or under-valued. We offer daily market coverage, weekly feature
stories, and a newsletter to investors who subscribe on PropThink.com. To learn
more, follow us on Twitter or visit us at http://www.propthink.com.
Disclaimer:
You should assume that as of the publication date of any report or letter,
PropThink, LLC and persons or entities with whom it has relation ships
(collectively referred to as "PropThink") has a position in all stocks (and/or
options of the stock) covered herein that is consistent with the position set
forth in our research report. Following publication of any report or
letter, PropThink intends to continue transacting in the securities covered
herein, and we may be long, short, or neutral at any time hereafter regardless
of our initial recommendation. To the best of our knowledge and belief, all
information contained herein is accurate and reliable, and has been obtained
from public sources we believe to be accurate and reliable, and not from company
insiders or persons who have a relationship with company insiders. PropThink was
not compensated to publish this article. Our full disclaimer is available
at http://www.propthink.com/disclaimer.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: PropThink via Thomson Reuters ONE
[HUG#1650871]
Unternehmensinformation / Kurzprofil:
Datum: 19.10.2012 - 19:00 Uhr
Sprache: Deutsch
News-ID 194348
Anzahl Zeichen: 4814
contact information:
Town:
New York
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 271 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"PropThink: PBYI Makes a Big Splash on the NYSE; Why all the Excitement?"
steht unter der journalistisch-redaktionellen Verantwortung von
PropThink (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
