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On Thursday, Jefferies analyst Anthony Petrone adjusted the price target for Tarsus Pharmaceuticals (NASDAQ:TARS), increasing it to $58.00 from the previous $54.00, while reiterating a Buy rating on the shares. The adjustment follows Tarsus Pharmaceuticals’ notable financial performance, which saw the company exceeding expectations each quarter during the fourth quarter and full year of 2024. According to InvestingPro data, the company’s market capitalization stands at $1.68 billion, with analyst targets ranging from $45 to $85 per share.
Petrone expressed surprise at the stock’s decline, noting that it had fallen more than 20% year-to-date despite the company’s strong results and the promising outlook for substantial revenue growth. InvestingPro data confirms this decline, showing a -19.56% YTD return, though the stock has demonstrated strength with a 45.6% gain over the past six months. He highlighted the anticipation of approximately 100% revenue growth in 2025 and the company’s progress toward reaching cash flow breakeven, aligning with InvestingPro’s analysis showing a projected 93% revenue growth for FY2025.
The analyst’s commentary underscored the successful launch of Xdemvy and the path to profitability for Tarsus Pharmaceuticals, which is projected for the years 2025 to 2026. While current EBITDA stands at -$119.34 million, Petrone pointed out that the current share price in the mid-$40s does not fully represent the company’s recent successes and its trajectory toward profitability. This view is supported by InvestingPro’s Fair Value analysis, which suggests the stock is currently undervalued.
The increased price target reflects Jefferies’ confidence in Tarsus Pharmaceuticals’ financial strategy and market performance. The firm’s analysis suggests that the stock’s current valuation does not align with its potential, given the company’s recent achievements and future growth prospects.
Investors and market watchers will likely monitor Tarsus Pharmaceuticals as it continues to work towards its financial goals, with the revised price target indicating a positive outlook from Jefferies for the company’s share value.
In other recent news, Tarsus Pharmaceuticals reported a strong fourth-quarter performance, with earnings surpassing expectations. The company announced $66.4 million in revenue, exceeding the anticipated $57.53 million, and an earnings per share (EPS) of -$0.60, which was better than the forecasted -$0.77. These results have led Guggenheim to maintain a Buy rating on Tarsus, raising the price target to $78 due to strong sales of Xdemvy. H.C. Wainwright also reiterated a Buy rating with a $73 price target, despite some investor concerns regarding increased marketing and R&D expenses.
Tarsus Pharmaceuticals dispensed 58,500 bottles of Xdemvy, surpassing their guidance and contributing to a full-year total of $180 million in sales. The company’s strategic initiatives, including an expanded sales force and direct-to-consumer campaigns, have been pivotal in driving growth. Analysts from Guggenheim and H.C. Wainwright expressed confidence in Tarsus’ future prospects, with Guggenheim highlighting the positive impact of the direct-to-consumer campaign on sales forecasts for 2025 and beyond. Tarsus anticipates continued growth, projecting to dispense between 62,000 and 67,000 bottles in the first quarter of 2025, while also planning significant investments in consumer campaigns.
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