On Monday, Boral (OTC:BOALY) Capital raised its rating on Citius Pharmaceuticals (NASDAQ: NASDAQ:CTXR) shares from Hold to Buy, setting a price target of $9.00. The upgrade reflects an adjustment in Boral Capital’s valuation model, which now accounts for a reverse stock split and a revised timeline for the anticipated approval of the company’s Mino-Lok product. According to InvestingPro data, the stock has shown strong momentum with a 26.46% gain in the past week, though it remains significantly below its 52-week high of $26.75.
Jason Kolbert of Boral Capital provided insight into the decision, indicating that the adjustment of the model was necessary due to the delay in Mino-Lok’s approval, which has been pushed back by three years. Despite this postponement, Kolbert sees a compelling reason for the upgrade tied to Citius’s majority-owned subsidiary, Citius Oncology. With a market capitalization of just $28.44 million and an overall financial health score rated as ’FAIR’ by InvestingPro, the company appears undervalued relative to its Fair Value estimate.
Citius Oncology, in which Citius Pharmaceuticals holds a 90% stake, is on the verge of bringing Lymphir to the market. Lymphir is an immunotherapy treatment developed for adults who are suffering from relapsed or refractory cutaneous T-cell lymphoma (CTCL). According to Kolbert, the impending launch of Lymphir is expected to act as a significant value driver for Citius Pharmaceuticals.
The optimism around Lymphir’s market potential and its impact on Citius’s valuation underpins the new Buy rating.
With a new price target of $9.00, Boral Capital signals its confidence in the future financial performance of Citius Pharmaceuticals, as the company prepares to commercialize its subsidiary’s promising immunotherapy treatment.
In other recent news, Citius Pharmaceuticals has been making significant strides in its development pipeline.
The company recently held a Type C meeting with the FDA, discussing the New Drug Application pathway for its product, Mino-Lok. This follows a successful Phase 3 clinical trial, with the FDA providing constructive feedback for a future submission. In parallel, Citius Pharmaceuticals has announced a 1-for-25 reverse stock split, aimed at satisfying Nasdaq’s minimum bid price condition for continued listing.
The company has also secured an extension from a Nasdaq Hearings Panel to regain compliance with the exchange’s minimum bid price requirement. Citius Pharmaceuticals has extended an employment agreement with Myron Holubiak, the company’s Executive Vice Chairman, and certain warrant agreements, which could provide approximately $2.4 million in cash proceeds if fully exercised.
Citius Pharmaceuticals also announced a merger with TenX Keane Acquisition, with Citius set to hold approximately 90% of the new entity, Citius Oncology, Inc. This merger is expected to enhance the potential commercialization of LYMPHIR™. EF Hutton initiated coverage on Citius Pharmaceuticals, issuing a Buy rating.
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