Cantor starts KemPharm at OW; PT $20

Cantor Fitzgerald initiated coverage of KemPharm (NASDAQ:KMPH) with an “overweight’ rating and a 12-month discounted cash flow-based price target of $20. The stock closed at $4.39 on Nov. 16.

“We think KemPharm’s products, pipeline and execution capability are underappreciated. Therefore, upward earnings-estimate revisions and pipeline advancements should drive the stock higher,” writes analyst Louise Chen.

She said the company is building a unique portfolio of products and pipeline with multiple clinical and regulatory milestones that “we believe could be positive inflection points for the stock.”

KemPharm focuses on high-value commercial opportunities addressing significant unmet needs in rare CNS and related disorders. Its AZSTARYS is the first and only approved methylphenidate-based drug containing serdexmethylphenidate or SDX that is indicated for the treatment of attention-deficit hyperactivity disorder. It was approved by the FDA in March 2021 and is being commercialized in the U.S. by Corium.

She said KemPharm has shifted its pipeline to focus on rare disease with arimoclomol for the treatment of Niemann-Pick disease and KP1077 for rare sleep disorders.