As shares of Sarepta Therapeutics (SRPT) continue to trade at levels unseen since 2014, analysts are finally giving investors the green light on this 18 year old stock, grading the stock a “buy” on average according to a MarketBeat Ratings Report. Ever since Sarepta received authorization to fill a new drug application for it’s lead product, Eteplirsen, additional good news has put the company back on the map and according to 19/20 analytics consulted in the MarketBeat report, woken it from its one year long slumber. The 1 year chart denotes a traditionally bullish cup-shaped trend on the graph:
Figure 1: 1 Year chart showing YoY gains with a positive trend
Additionally, Sarepta stock showed a put/call ratio of .32 with a high volume of 1450 contracts, a very bullish signal generated from market participants.
The company’s first quarter financial statements were welcomed warmly by investors, even though the company posted zero revenue growth. The most positive piece of information out of the company’s financial report is the explosive growth in research and development (90% Year over year and 27% over the last quarter)- Sarepta has many medical products in their pipeline targeting rare and infectious diseases.
Each pending drug in the pipeline is a potential massive revenue opportunity for Sarepta. However, no company will be supported if it fails to create and sustain a reliable revenue stream that covers its costs and more. Sarepta has employed a defensive strategy of taking minimal bank loans, proving to be a good method to ease cash flow and keep equity investors from dumping the stock.
Sarepta Therapeutics has challenges to overcome, but as long as the good news keeps rolling in and as long as its science is sound, it has a future in the biotech and high-tech industries. Even if skeptics do not cast this stock as an outright “buy”, it is certainly a “watch” in anyone’s books..