Analyst: Biotech Stock to Drop Now

ACOR shares are down on restructuring plans and weak drug sales

Managing Editor
Oct 24, 2019 at 10:19 AM
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Shares of Acorda Therapeutics Inc (NASDAQ:ACOR) are plunging this morning, already down 13.9% to trade at $2.33. Acorda issued a double-whammy last night, sharing its corporate restructuring plan -- which includes a 25% cut to its workforce -- and unveiling lackluster third-quarter sales of Inbrija, its Parkinson's drug. As such, ACOR was slapped with a pair of bearish notes from analysts.

J.P. Morgan Securities analyst Cory Kasimov downgraded ACOR stock to "underweight" from "neutral," stating, "We simply don't see a near-term fix for [Inbrija] or [this] company," and warning that the pharma concern's "path forward could become increasingly difficult." Meanwhile, Wedbush trimmed its price target to $2.78 from $3. From a broader perspective, seven of eight covering brokerage firms issued a "hold" recommendation coming into today, with one offering up a "strong buy."

On the charts, Acorda Therapeutics stock has had a rough go, shedding 86% over the past 12 months alone. The descending 40-day trendline has been overhead resistance for the shares in 2019, capping multiple breakout attempts since January. What's more, ACOR shares touched a 13-year low of $2.27 on Oct. 14, and matched that low in intraday trading this morning.

Short interest on ACOR has been plunging, down 19.1% during the past two reporting periods. However, these bearish bets still account for more than 27% of the stock's total available float.

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