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Bryon Capital ups Cipher price target to $5.25

March 1, 2013 by · Leave a Comment 

increaseinstockBryon Capital Markets has raised its price target on “buy-rated” Cipher Pharmaceuticals (TSX:DND; OTCBB:CPHMF) to $5.25 from $4.50 after the drug developer posted record results for 2012. The stock closed at $2.90, up 45 cents, or 18% on Friday.

Analyst Doug Loe said his target is still based on 15 times estimated 2015 results, with estimated per share earnings now raised to 54 cents from an earlier forecast of 47 cents, and eight times estimated EV/EBITDA, with 2015 EBITDA now forecast at $15-million, up from $13.3-million).

“The key takeaway for us is this – with Absorica already capturing 1.8% of the U.S. isotretinoin market, a market that last year was about $437- million (Teva’s market-leading Claravis and Mylan’s Amnesteem are the two major brands), and in Jan/13 already doubling that market share to 3.6%, we are confident that longer-term Absorica update will be correspondingly strong and exceed our current forecasts,” which he has revised upwards,” Mr. Loe said.

He said Cipher’s balance sheet remains strong, with $15.8-million in cash and no long-term debt at end of 2012. “With positive quarterly operating cash flow expected throughout our forecast period, the firm could make strategic product in-licensing deals to supplement its Lipofen/ConZip-Durela/Absorica-Epuris franchise without materially disrupting current capital structure.”

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