Marinus Pharmaceuticals Stock Gets Another Stunning Bull Note

Short sellers could continue to cover, which would result in more tailwinds for the stock

Jun 6, 2018 at 9:17 AM
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Biopharmaceutical stock Marinus Pharmaceuticals Inc (NASDAQ:MRNS) has been grabbing the attention of Wall Street analysts this year. Mizuho initiated coverage back in March with a $13 price target when MRNS shares were trading below $5, and Baird set an even higher price target of $15 a few weeks back. This morning it was Ladenburg Thalmann that weighed in on the equity, beginning coverage with a "buy" rating and whopping $20 price target. The stock closed Tuesday at $6.74, meaning it would need to nearly triple in value to reach this lofty goal.

Of course, MRNS is set to rally thanks to this bull note, up 7.6% before the open. This would put the stock above the $7 level for the first time since January, and within striking distance of its year-to-date breakeven point of $8.16. The shares gapped back above their 200-day moving average following Baird's bull note in late May and have pushed higher since, riding a five-day win streak into today's session. From a longer-term perspective, MRNS has been even more impressive, as it was trading at just $1.24 this time a year ago.

Not surprisingly for a clinical-stake biopharma stock, Marinus Pharmaceuticals is heavily shorted. Short sellers currently hold 8.5% of the total float, and it would take them more than six sessions to buy back their shares, going by average daily volumes. However, short interest has been declining in recent weeks, including a 16.3% drop in the last two reporting periods. As such, upside momentum could be augmented by an extended exit of short sellers.

Judging by Marinus' business update from early May, there could be a number of catalysts ahead this year. The company said it was beginning a phase 3 trial for oral ganaxolone in mid-2018, and will report data from a phase 2 trial for intravenous ganaxolone for women with severe postpartum depression in the third quarter.


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