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On Thursday, Canaccord Genuity updated its financial model for Zevra Therapeutics, Inc. (NASDAQ:ZVRA), leading to an increased price target while maintaining a positive outlook on the company’s stock. Canaccord analyst Sumant Kulkarni set the new price target at $25.00, up from the previous $23.00, and reaffirmed a Buy rating for the biopharmaceutical company. Currently trading at $7.92 with a market capitalization of $425 million, Zevra has seen three analysts revise their earnings estimates upward for the upcoming period, according to InvestingPro data.
Kulkarni’s decision to adjust the price target followed Zevra Therapeutics’ fourth-quarter 2024 financial results. The company reported revenue of $23.61 million in the last twelve months, with a gross profit margin of 68.59%. The analyst highlighted that the 2025 sales estimate for Miplyffa, one of Zevra’s key products, remains approximately $63 million. Additionally, a conservative sales contribution of $0.9 million for Olpruva was maintained in the model. InvestingPro analysis indicates that analysts anticipate sales growth in the current year, though the company is not expected to be profitable.
The updated analysis also includes a revised timeline for the potential market introduction of KP-1077, a treatment for idiopathic hypersomnia (IH) and narcolepsy. The launch is now anticipated to occur in 2028 for IH and 2029 for narcolepsy, a year later than previously expected for each indication. The probabilities of approval for KP-1077 remain unchanged at 15% for both conditions. Kulkarni noted that Zevra Therapeutics is actively exploring options for KP-1077 and that any outcomes from these endeavors would prompt further adjustments to Canaccord’s model.
The report also mentioned that there have been no significant changes to the near-term operating expense estimates for Zevra Therapeutics. However, the forecast for launch-related expenses has been updated to align with the new timeline for KP-1077. InvestingPro data shows the company maintains a healthy current ratio of 2.53, though it is currently burning through cash with negative free cash flow of $69.64 million in the last twelve months.
A final key factor influencing the revised price target is the inclusion of an anticipated $148 million in net proceeds from other income in the second quarter of 2025. This figure accounts for the potential sale of Zevra’s Priority Review Voucher (PRV), which is a significant element underpinning the increase in the discounted cash flow (DCF)-based price target. Based on comprehensive analysis available through InvestingPro’s exclusive research reports, which cover over 1,400 US stocks including Zevra, the stock currently appears to be trading above its Fair Value.
In other recent news, Zevra Therapeutics reported its fourth-quarter financial results for 2024, showing a net loss of $35.7 million, or $0.67 per share, which was larger than analysts’ expectations of a $0.40 loss per share. However, the company generated $12 million in revenue, surpassing the forecasted $8.52 million, driven by strong U.S. sales of its product MIPLYFFA. JMP Securities responded to these results by raising the price target for Zevra Therapeutics to $18.00, up from $17.00, maintaining a Market Outperform rating. In contrast, Cantor Fitzgerald maintained its Overweight rating with a $25.00 price target, showing confidence in Zevra’s patient transition success from its Expanded Access Program to its commercial drug.
Zevra Therapeutics also reported having $75.5 million in cash reserves by the end of 2024 and guidance that suggests sufficient funds to continue operations until 2029. The company plans to further boost its financial standing with the potential sale of a priority review voucher. Additionally, Zevra is intensifying efforts to identify and diagnose patients with Niemann-Pick disease type C (NPC) in the U.S., drawing comparisons to the impact of miglustat in Europe, which has been associated with increased diagnoses over time. These recent developments reflect a strong performance and promising future prospects for Zevra Therapeutics.
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