2 Small-Cap Stocks Rising on New "Buy" Ratings

B. Riley predicted strong sales of imetelstat after FDA approval

by Karee Venema

Published on Jan 31, 2019 at 11:44 AM
Updated on Jan 31, 2019 at 11:55 AM

B. Riley upgraded Geron Corporation (NASDAQ:GERN) to "buy" from "neutral," and raised its price target to $3.25 from $1.50 -- a 215% premium to last night's close. The analyst in coverage waxed optimistic on the drugmaker's myelofibrosis treatment imetelstat, projecting approval from the Food and Drug Administration (FDA) by 2023, and U.S. sales of $750 million by 2026.

In response, GERN stock is up 7.8% to trade at $1.11, but remains well off its mid-September high of $6.99. On Sept. 27, the shares gapped down nearly 63% after Johnson & Johnson (JNJ) terminated its imetelstat collaboration with Geron, and have been trending lower ever since.  And while the equity has come off its Dec. 21 record low of $0.95, the rebound is running out of steam near the 40-day moving average.

gern stock daily chart jan 31

H.C. Wainwright initiated coverage on Mesoblast Limited (NASDAQ:MESO) with a "buy" rating and $6.50 price target, representing expected upside of 43% to Wednesday's close at $4.54. The brokerage firm called MESO's product pipeline "mature," and said its proprietary platform has been validated by the approval of TEMCELL and Alofisel in the U.K. and Japan.

After being down as much as 3% earlier, MESO stock has bounced from its 40-day moving average to trade up 0.2% at $4.55. The shares bottomed at a nine-year low of $3.35 on Dec. 24, and eventually rallied back up near $5 -- a level that's served as both support and resistance over the last 12 months.

meso stock daily chart jan 31

Most analysts are already bullish on Mesoblast, with 80% of those in coverage maintaining a "buy" rating ahead of today, and not a single "sell" on the books. Plus, the average 12-month price target sits all the way up at $14.55.


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