Cormark raises QLT price target

On the heels of QLT (NASDAQ:QLTI; TSX:QLT) reaching a 52-week high of $5.45 (U.S.) on Wednesday, Cormark Securities raised its price target to $6.50 from $5.35, maintaining a “buy” rating on the stock.

In a new report, analyst David Dean writes that QLT expects to report data this year from two clinical programs, which “do not appear to have any value within the share price.”  Noting that the stock is trading below the combination of the working capital and any reasonable EBITDA multiple, “if there is any success in the clinic, QLT’s share price will be very leveraged to it.”

On the other hand, if both clinical programs fail, there could be increased pressure on QLT to dissolve the company and distribute the assets, he contends.  ”This could result in greater value than the current share price,” protecting the downside from clinical failures, he added.