- Novan ( NASDAQ: NOVN ) stock gained over 11% on Tuesday after Oppenheimer began coverage with Outperform rating, saying it is positioned for commercial success as it prepares NDA filing for topical nitric oxide-releasing drug SB206.
- Th rating is in-line with bullish sell-side ratings (2 Strong Buy, 2 Buy).
- Oppenheimer's rating is based on "opportunity for SB206 to become the market leader for treating molluscum contagiosum, modest sales growth for commercial assets acquired from EPI Health , and the Nitricil platform", Jeff Jones wrote in a note to clients.
- The brokerage set a $12 price target on NOVN, implying potential upside of ~392% to its last close.
- Ex-U.S. commercialization of SB206 by partner Sato Pharmaceutical in Japan and NOVN's pipeline of clinical-stage assets built on Nitricil offer potential upside to Oppenheimer's valuation of NOVN.
- "We anticipate additional financing will be needed to support operations through 2023," Jones added.
- On the other hand, SA Quant rated NOVN Strong Sell as the stock scored poorly in factor grades valuation and profitability.
- Shares of NOVN declined ~42% YTD.
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Novan stock gains; Oppenheimer begins coverage at Outperform on SB206's market potential