The current weakness in shares of BioSysent (TSXV:RX) is a buying opportunity, says Cantor Fitzgerald Canada analyst Scott Curtis.
In a research update to clients yesterday, Curtis reiterated his “Speculative Buy” rating and $13.25 one-year target on BioSyent, implying a return of 58% at the time of publication.
Curtis says despite recent nervousness in the market, nothing has fundamentally changed with the company.
“We feel the market is over-reacting to news that a competitor recently launched a generic version of FeraMAX®. RX has always faced competition from iron deficiency products – the Company has managed to dominate the market even with these competitive pressures due to its focused promotion and brand power,” said Curtis. “In our opinion, new generic competitors do not pose a serious threat due to: lack of reimbursement, lack of availability, and lack of promotion”.
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Curtis says investors should not underestimate the power of marketing and brand in the space. He says that as the result of years of marketing and promotion, FeraMAX® is a household brand in the the iron deficiency market that has thrived through the introduction of competition. He says BioSyent’s as a smaller company with just a few products, lends a focus to promoting FeraMAX® that may be absent from some of its competitors, who market large portfolios of products.
At press time, shares of BioSyent were down 2.2% to $8.56.