Analysts expect the shares to rally 60% or more
The shares of healthcare concerns Collegium Pharmaceutical Inc (NASDAQ:COLL) and Stemline Therapeutics Inc (NASDAQ:STML) are higher today, thanks to some upbeat analyst attention. Specifically, Cantor Fitzgerald last night initiated coverage of COLL stock with an "overweight" rating and a lofty $40 price target -- representing expected upside of 60% to the equity's Monday close. Likewise, Roth Capital started STML stock with a "buy" endorsement and a $30 price target, which represents a premium of nearly 68% to the biopharma stock's close yesterday.
COLL a Top Pharma Pick at Cantor
Along with AcelRx Pharmaceuticals (ACRX), Collegium Pharmaceuticals stock still has "value to be unlocked," Cantor wrote, calling COLL one of its "top picks." In fact, the brokerage firm said Collegium is "emerging as the new leader in responsible pain treatment," and the shares continue to "trade at a discount" to intrinsic value.
From a sentiment standpoint, the specialty pharma stock is no stranger to upbeat analyst attention. In fact, all six of the analysts following COLL maintain "strong buy" opinions. Plus, the consensus 12-month price target of $33.50 represents expected upside of 26.1% to the security's current price.
On the charts, COLL stock more than tripled from its late-October lows to its early March two-year high of $29.90. Since then, the shares have spent the bulk of 2018 in a sideways channel, with support emerging in the $22 area and resistance in the $26-$27 region. At last check, Collegium stock was up 5.7% at $26.39.
Roth Capital Optimistic About Stemline's Lead Asset
Roth Capital said it expects Stemline Therapeutics to "sail smoothly" through a biologics license application (BLA) "and then through M&A, thanks to strengths of its lead asset SL-401." In fact, STML shares touched a four-year high of $20.55 on June 5, after reporting upbeat data on SL-701 and SL-801 at the 2018 American Society of Clinical Oncology (ASCO) annual meeting. The company also said in a statement that its "SL-401 regulatory and pre-launch activities continue to progress," and its timelines remain on track.
STML stock has added 140% in the past year, and has been in a channel of higher highs since the fourth quarter. The shares were last seen 2% higher at $18.25 -- back above their 50-day moving average, which has provided support in 2018, along with its 80-day and 160-day counterparts.
While all four analysts following STML already deem it worthy of a "strong buy" rating, not everyone is convinced. Short interest represents nearly 9% of the equity's total available float, and would take nearly eight sessions to repurchase, at the stock's average pace of trading. That's plenty of fuel for a short squeeze to push the biopharma stock even higher.