I penned an article in mid-February on a small biotech company called Vical (VICL). At the time I thought it was a great high risk/high reward play for aggressive investors in the biotech space. The stock has not done much since that time, but its recent earnings report and some other catalysts could move the stock over the coming months:
Highlights from Earnings report and other developments:
- The company broke even for the quarter compared with the consensus estimate of a loss of 7 cents a share.
- Revenues increased to over $11mm versus the $2.58mm, mainly on the recognition of a $10mm milestone payment the company received in the quarter.
- In late April, Credit Suisse assumed coverage with an "Outperform" rating and a $5 price target on VICL.
4 additional catalysts for VICL which is trading at $3 a share:
- There is increasing recognition around DNA vaccines where "off-the-shelf" products can be produced cheaper and faster. Although no therapeutic DNA vaccine has yet been approved, Vical currently has several clinical trials in progress.
- The milestone payment certainly helps Vical's cash position which went up substantially Q/Q and it now has $94mm in cash, cash equilivents, marketable securities including restricted.
- The 4 analysts that cover the stock have a median price target of $6 a share on the stock.
- Results from its phase III trial of Allovectin, its first-line therapy for patients with Stage III or IV recurrent metastatic melanoma, should be complete by the end of 2012.
Disclosure: I am long VICL.