Reviva Pharmaceuticals target cut to $14 by Benchmark

On Wednesday, Benchmark analysts adjusted their outlook on Reviva Pharmaceuticals (NASDAQ:RVPH) by reducing the price target to $14 from the previous $17 while maintaining a Speculative Buy rating on the company's stock. With the stock currently trading at $0.54, analyst targets range from $2 to $17, according to InvestingPro data. The revision comes as a response to the latest financial disclosures.

The move to lower the price target was influenced by the updated share count detailed in the company's 10-K filing. The increased number of shares outstanding necessitated a change in the valuation model used by Benchmark analysts. With a current market capitalization of $24.92 million and the stock down over 85% in the past year, the company's shares are currently in oversold territory based on RSI indicators, according to InvestingPro analysis. Despite the reduction in the price target, the firm's Speculative Buy rating suggests a continued positive outlook on the stock's potential.

Reviva Pharmaceuticals is anticipated to approach several significant milestones in the near future. Analysts are looking forward to the release of the full dataset from the ongoing OLE trial, which is expected in the second quarter of 2025. Additionally, the initiation of the RECOVER-2 trial is slated for mid-2025. Another major event for the company will be the submission of the New Drug Application (NDA) for Brilaroxazine, intended for the treatment of schizophrenia, which is scheduled for the fourth quarter of 2026.

The company concluded the quarter with $13.5 million in cash reserves. While InvestingPro data shows the company maintains more cash than debt on its balance sheet, with a current ratio of 1.01, its overall financial health score is rated as weak. According to the analysts, Reviva Pharmaceuticals may explore partnership and licensing opportunities to secure the necessary capital to advance its clinical programs.

The analysts noted that the data collected so far indicates that Brilaroxazine could offer better efficacy, fewer side effects, higher patient compliance, and simpler dosing compared to existing treatments for schizophrenia. These attributes potentially make Brilaroxazine a compelling option for partners within the pharmaceutical industry. Unlock 10+ additional InvestingPro Tips and comprehensive financial metrics to better evaluate RVPH's potential by visiting InvestingPro.

In other recent news, Reviva Pharmaceuticals has made notable changes to its executive compensation structure, as detailed in a recent SEC filing. The company increased the base salaries of its top executives, with Dr. Laxminarayan Bhat, the President and CEO, now earning $565,000, while CFO Narayan Prabhu and Vice President Seema Bhat received increases to $330,000 and $340,000, respectively. Alongside these adjustments, cash bonuses for the fiscal year 2024 were awarded, and stock options were granted under the 2020 Equity Incentive Plan. Approximately 42% of these options vested immediately, with the remainder to vest monthly through December 2027.

Additionally, Reviva Pharmaceuticals has been upgraded by analysts at Maxim Group and Roth/MKM. Maxim Group raised the stock rating to Buy and set a new price target of $7.00, citing positive preliminary data from the open-label extension study for brilaroxazine, an investigational treatment for schizophrenia. Roth/MKM also issued a Buy rating with the same price target, supported by promising Phase 3 clinical trial results for brilaroxazine. The company's recent financial improvements include securing $18 million in funding, with the potential for an additional $9 million from warrants, which is expected to support the progression of Reviva's second Phase 3 study. Despite concerns about potential near-term dilution, analysts see the anticipated New Drug Application filing for brilaroxazine in mid-2026 as a significant milestone.

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