Two 59%+ winners, four above 25% in Aug – How this AI model keeps picking winners
On Friday, H.C. Wainwright raised the price target on Xeris Pharmaceuticals (NASDAQ:XERS) shares to $8.00 from $6.60, while maintaining a Buy rating on the stock. The firm’s analyst cited several reasons for the optimistic outlook, including strong 2025 guidance that exceeded market expectations and indicated a clear path to cash flow breakeven for the company. According to InvestingPro data, the stock has shown remarkable momentum with a 69% return over the past year and maintains a "GOOD" overall financial health score.
Xeris recently provided its first-time 2025 guidance, projecting revenues between $255-275 million, which was 11% above the consensus estimates and represented a 30% year-over-year increase at the midpoint. The company’s history of meeting or exceeding the higher end of its guidance in the past two years has bolstered investor confidence. This optimism appears well-founded, as InvestingPro data shows the company achieved nearly 24% revenue growth in the last twelve months, with a healthy gross profit margin of 82%. Additionally, the guided operational expenditures (OPEX) increase of only mid-to-high single digits suggests that the company will achieve higher operating leverage faster than anticipated.
The stock of Xeris Pharmaceuticals responded positively to the guidance, rising 9.6%, in contrast to the XBI index, which fell by 0.9%. Despite the stock’s 19% increase since being named a top pick by H.C. Wainwright on January 27—a period during which the XBI index declined by 6%—the firm believes that further multiple expansion is justified. The analyst pointed out that Xeris is trading at approximately 3 times the 2025 enterprise value to revenue (EV/REV) on the midpoint 2025 revenue, despite projections of continued strong double-digit revenue compound annual growth rate (CAGR). While InvestingPro analysis suggests the stock is currently trading above its Fair Value, the company’s strong momentum is evidenced by its 65% price return over the past six months. Subscribers can access 8 additional ProTips and comprehensive valuation metrics for deeper analysis.
The growth prospects of Xeris are supported by products such as Recorlev and Gvoke, which have intellectual property protection until 2036 and 2040, respectively. The analyst also mentioned that comparable companies have been acquired for around 4.5 times revenue, which suggests potential for Xeris.
The analyst expressed anticipation for mid-year clarity on the development pathway of XP-8121, Xeris’ potentially transformative once-weekly levothyroxine autoinjector. With more than 3 million patients potentially inadequately controlled on oral levothyroxine therapy, XP-8121 could represent a significant market opportunity, where each 1% market share could equate to $200 million in revenue.
In light of these factors, H.C. Wainwright has raised its estimates for Xeris and increased the target price based on a discounted cash flow (DCF) analysis to the new $8.00 target.
In other recent news, Xeris Pharmaceuticals reported its fourth-quarter 2024 earnings, beating expectations with an earnings per share (EPS) of -0.03 compared to the forecasted -0.06. The company also surpassed revenue forecasts, reporting $60.1 million against the anticipated $55.99 million. This performance was largely driven by the success of its Recorlev and Gevo (NASDAQ:GEVO) products, which contributed to significant revenue growth. For the full year 2024, Xeris achieved a total revenue of $203.1 million, marking a 24% increase from the previous year. The company projects strong revenue growth for 2025, estimating between $255 million and $275 million. Analysts from firms like Craig Hallum and H.C. Wainwright have shown interest in the company’s strategic plans and market dynamics. Xeris Pharmaceuticals has also been recognized for its disciplined expense management and expanding prescriber base, which have bolstered its competitive position in the endocrinology market. The company is preparing for the Phase 3 development of XP8121, a treatment for hypothyroidism, with potential clinical trials starting in 2026.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.