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Investing.com - TD Cowen downgraded Verona Pharma (NASDAQ:VRNA) stock rating from Buy to Hold while raising its price target to $107.00 from $100.00 following news of an acquisition by Merck (NSE:PROR). The company, currently valued at $7.92 billion, has demonstrated remarkable performance with a 409% return over the past year, according to InvestingPro data.
The pharmaceutical company will be acquired by Merck at $107 per American Depositary Share (ADS), representing a 39% premium over the 60-day average and a 23% premium over the previous day’s closing price. InvestingPro analysis shows the company maintains impressive gross profit margins of 95%, with 14 additional key insights available to subscribers.
TD Cowen indicated the acquisition price appropriately values Verona Pharma’s "multibillion-dollar potential" in the pharmaceutical market.
The research firm does not anticipate regulatory concerns or competing acquisition offers to emerge during the transaction process.
The acquisition is expected to close in the fourth quarter, with TD Cowen noting no other major catalysts for Verona Pharma are anticipated in the interim period.
In other recent news, Merck is reportedly nearing a $10 billion acquisition of Verona Pharma, with an offer of $107 per share, as reported by the Financial Times. This potential acquisition would expand Merck’s portfolio in respiratory disease treatments, although no official announcements have been made by either company. Meanwhile, Piper Sandler has reiterated its Overweight rating on Verona Pharma, raising its price target to $160, citing the successful market launch of Verona’s COPD treatment, OHTUVAYRE. The drug is projected to achieve sales of $91.8 million in the second quarter of 2025, with full-year sales estimated at $409.1 million. Cantor Fitzgerald also maintained its Overweight rating on Verona Pharma, supporting the view that the company has significant upside potential, especially if OHTUVAYRE reaches over $400 million in sales for 2025. Jefferies raised its price target for Verona Pharma to $110, highlighting strong sales of OHTUVAYRE, which generated $71 million in the first quarter of 2025. The firm suggests that Verona Pharma could achieve profitability in the second quarter of 2025, adding a positive outlook to their analysis. These developments indicate a strong focus on Verona Pharma’s growth prospects and potential market impact.
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