Raymond James maintains Pacira stock at Market Perform

On Friday, Raymond (NS:RYMD) James analyst reiterated a Market Perform rating on Pacira Pharmaceuticals (NASDAQ:PCRX), acknowledging the company's solid fourth-quarter performance and its ambitious five-year plan. Pacira reported preliminary fourth-quarter revenue of $187.3 million, surpassing Raymond James' estimate of $184.5 million and the consensus of $181.1 million.

The company's performance reflects its continued revenue growth trajectory, with a 4.4% increase over the last twelve months. According to InvestingPro analysis, the company maintains a GREAT financial health score, suggesting strong operational fundamentals despite current market challenges.

Despite not providing guidance for 2025, which is expected to be announced on the upcoming earnings call scheduled for February 27, Pacira's management has introduced a new growth-oriented strategy called "5x30." This plan aims to achieve various financial objectives, including a double-digit revenue compound annual growth rate (CAGR) and a 5% gross margin improvement from its current 63.25% level.

Additionally, strategic goals have been set to expand the pipeline and establish partnerships for pipeline and commercial agreements. InvestingPro data reveals that analysts expect the company to return to profitability this year, with an EPS forecast of $3.38 for 2024.

The analyst pointed out that there remains a degree of uncertainty regarding the potential timing and impact of generic competition for Pacira's product Exparel. However, the company's long-term objectives do not appear to be factoring this as a significant threat, and no update on litigation was provided.

Furthermore, the analyst mentioned the NOPAIN Act as a possible positive factor for the company starting in 2025, but further details on its anticipated impact are yet to be disclosed. Notably, InvestingPro indicates the company has been actively managing its capital position, with liquid assets exceeding short-term obligations and a strong free cash flow yield, suggesting financial flexibility to navigate potential challenges.

The Market Perform rating reflects the ongoing uncertainties surrounding the company, particularly concerning the generic competition for Exparel. The analyst's stance indicates a neutral outlook on the stock, though InvestingPro's Fair Value analysis suggests the stock may be undervalued at current levels. With analyst targets ranging from $8 to $39 per share and a beta of 0.77, investors seeking detailed insights can access comprehensive analysis through InvestingPro's Research Reports, which provide in-depth coverage of PCRX among 1,400+ US equities.

In other recent news, Pacira BioSciences reported significant revenue growth and outlined its strategic objectives for 2030. The company highlighted an increase in net product sales for its flagship product EXPAREL and other key products like ZILRETTA and iovera°. Pacira also announced its plans to release complete financial results for the fourth quarter and full-year 2024 later in the first quarter of 2025.

The company's commitment to non-opioid pain therapies was further emphasized with the FDA clearance for a new back pain treatment and promising results from its osteoarthritis gene therapy trial. Analysts from InvestingPro expect the company to turn profitable in the coming year, with an EPS forecast of $3.38 for 2024.

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