The week got off to the worst possible start for Aurinia (AUPH) shareholders. The stock took a beating in Monday’s session after investors were disappointed with the commercial-stage biopharma’s latest financial report.
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That is despite the results coming in above Street expectations. The company generated revenue of $23.4 million, beating the consensus estimate by $1.57 million, while EPS of -$0.25 also come in above the forecast – by $0.02.
The company’s sole commercial product is Lupkynis (voclosporin), which was approved to treat adult patients with active lupus nephritis (LN) early last year, in what was the first FDA-approved oral therapy for the autoimmune disease.
For the full year 2021, Lupkynis generated revenue of $45.5 million, coming in within the $40-50 million guided range, but the outlook for the treatment was a letdown.
The company expects Lupkynis to deliver sales in the $115-$135 million range this year. While that range amounts to a ~150-200% year-over-year uptick, it is still some way below Wall Street’s expectation of $182 million.
The company also announced that its ATM sales agreement has been terminated and no further sales are anticipated to take place under the ATM. The company generated net proceeds of $196.7 million from the ATM offerings at an average price of $19.91 after the shelf prospectus – which included an opportunistic ATM provision – was submitted last November. After which, the company saw out the quarter with cash & equivalents and investments of ~$466 million.
RBC’s Douglas Miehm notes this could “concern investors given AUPH would not likely be selling stock aggressively, if a take-out were imminent.”
That said, the analyst sees potential for regulatory approval for Lupkynis this year in the EU and Japan – markets where Aurinia already has licensing agreements.
All in all, Miehm rates AUPH an Outperform along with a $31 price target. If the target is achieved, the stock could provide ~152% returns over the next 12 months. (To watch Miehm’s track record, click here)
The rest of the Street agrees. All recent analyst reviews are positive, providing this stock with a Strong Buy consensus rating. Shares are expected to appreciate by 162% over the coming year, given the average price target currently stands at $32.25. (See AUPH stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
