Bell Potter upgrades Clinuvel Pharmaceuticals Limited to a buy

Bell Potter rates Clinuvel Pharmaceuticals (ASX: CUV) as a buy.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The News Corp media is that morning reporting that sell-side broker Bell Potter has upgraded ASX stock Clinuvel Pharmaceuticals (ASX: CUV) to a "buy" rating.

Clinuvel is a global biopharmaceutical business headquartered in Melbourne that sells treatments for a range of genetic and skin disorders with its main product named SCENESEE that is used to treat a rare genetic skin disorder called erythropoietic protoporphyria (EPP).

Its shares are now up more than 150% over the past year after it reported a profit of $4.076 million on revenue of $8.98 million for the six month period ending December 31 2018.

The revenue and profit were up 27% and 189% respectively over the prior corresponding half year period. It also held no debt and $42.3 million cash on hand to fund its growth strategies.

Its SCENESEE product is approved and sold in the EU and the company has applied to the US healthcare regulator the FDA for permission to sell the product to certain classes of patients, with a decision from the regulator due in July 2019.

Management appear confident the product will be approved, with it reporting that approval would potentially double its EPP product's addressable market.

However, investors should remember that there's no guarantees for new product approval from the FDA, while anticipation of the product being approved may already be factored into the fast-rising share price.

Another ASX-listed  biopharmaceutical company to have a product application delayed (at a minimum) by the FDA recently is Starpharma Limited (ASX: SPL), despite its management team telling investors they were confident their product application would be approved.

Clinuvel has a market value of $1.24 billion today based on a share price of $25.33, which suggests investors are confident it will get the US regulatory approval required. If not the stock could come under selling pressure.

Motley Fool contributor Tom Richardson has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

A couple stares at the tv in shock, one holding the remote up ready to press.
Mergers & Acquisitions

Telstra share price climbs amid $3.4b Foxtel sale

Who is buying the Foxtel business? Let's find out.

Read more »

A young man pointing up looking amazed, indicating a surging share price movement for an ASX company
Share Market News

Brokers say these ASX 200 growth stocks could rise 50% to 70%

Analysts think these shares could be dirt cheap and destined to generate big returns.

Read more »

Two people having a meeting using a laptop and tablet to discuss Seven West Media's balance sheet
Broker Notes

Why these ASX shares could be top SMSF options in 2025

Analysts are bullish on these high-quality shares. Let's find out why.

Read more »

The words short selling in red against a black background
Share Market News

These are the 10 most shorted ASX shares

Let's see which shares short sellers are targeting this week.

Read more »

Smiling man with phone in wheelchair watching stocks and trends on computer
Share Market News

5 things to watch on the ASX 200 on Monday

A good start to the week is expected for Aussie investors. Here's what to watch.

Read more »

A businessman compares the growth trajectory of property versus shares.
Opinions

What's the outlook for shares vs. property in 2025?

The experts have put out their new year predictions...

Read more »

a man sits at his desk wearing a business shirt and tie and has a hearty laugh at something on his mobile phone.
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

A young man pointing up looking amazed, indicating a surging share price movement for an ASX company
Broker Notes

These ASX 200 shares could rise 20% to 40% in 2025

Analysts are tipping these shares to deliver huge returns for investors next year.

Read more »