On Wednesday, Oppenheimer updated its outlook on Tarsus Pharmaceuticals (NASDAQ:TARS), a $1.8 billion market cap biotechnology company, increasing the price target to $72.00 from the previous $65.00 while maintaining an Outperform rating on the stock.
The adjustment reflects the firm’s positive view on the company’s recent performance and future prospects. According to InvestingPro data, analyst targets for TARS range from $41 to $84, with the stock currently trading near $47.
The analyst at Oppenheimer, Francois Brisebois, provided insights into the rationale behind the raised price target. The commentary focused on Tarsus Pharmaceuticals’ impressive sales figures for their product XDEMVY, particularly highlighting its potential in treating ocular rosacea. The company has demonstrated remarkable growth, with InvestingPro data showing an extraordinary revenue growth of 802% over the last twelve months.
Brisebois noted that Tarsus had shown solid performance in November, which continued to improve in December. According to IQVIA data, December sales reached 24,031 bottles, a significant increase from November’s 20,689 and October’s 20,137.
Oppenheimer’s revised estimates suggest that quarterly sales could reach approximately 58,000 bottles, surpassing Tarsus’s own guidance of 50,000 to 55,000 bottles. This projection is also higher than Oppenheimer’s previous estimate of around 53,000 bottles. Consequently, the firm has increased its fourth-quarter 2024 sales projection for Tarsus to $64.9 million, up from the prior estimate of $59.5 million and above the Street’s expectation of $58 million.
The analyst expressed confidence in Tarsus’s ability to execute its business strategy effectively, considering it a de-risking factor for the company. This confidence is supported by the company’s strong financial position, with InvestingPro analysis indicating TARS holds more cash than debt and maintains healthy liquidity ratios.
With the latest financial data exceeding expectations, Oppenheimer’s reiteration of the Outperform rating and the hike in the price target to $72 from $65 underscores the firm’s optimistic stance on Tarsus Pharmaceuticals’ stock. For deeper insights into TARS’s valuation and growth potential, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with detailed analysis and actionable intelligence.
In other recent news, Tarsus Pharmaceuticals has seen substantial developments. The company has reported record-breaking sales for its product, XDEMVY, with net sales reaching $48 million in Q3 2024. This success led H.C. Wainwright to upgrade the stock target from $61.00 to $73.00, maintaining a buy rating. Goldman Sachs also reiterated a neutral rating with a steady $41.00 price target on Tarsus shares.
Additionally, Tarsus has undergone a reshuffling of its board, with Rosemary Crane resigning and Wendy Yarno appointed as the Chairperson of the Commercial Committee of the Board. The company also secured a new headquarters in Irvine, indicating a commitment to growth. On the research front, Tarsus is preparing for a Phase 2 study for TP-04, a topical gel for treating ocular rosacea, expected to start in the second half of 2025.
These are recent developments that have occurred within Tarsus Pharmaceuticals. The company has also expanded its sales force from 100 to 150, securing over 80% coverage through commercial and Medicare contracts. However, the company’s operating expenses remain high, totaling approximately $73.3 million. As per InvestingPro’s analysis, Tarsus is projected to see a 9.02% revenue growth for the current fiscal year.
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