Laurentian Bank Securities analyst Joseph Walewicz thinks Trimel Pharmaceuticals (TSX:TRL) has considerable upside.
In a research update to clients today, Walewicz reiterated his “Buy” rating and one year target price of $1.45 on Trimel. The analyst says he expects the company’s upcoming second quarter results, which it will report tomorrow before market open, will not contain enough time within the launch of Natesto to make a serious impact. He expects Trimel will lose $600,000 on revenue of $3.5-million, a topline estimate that is above consensus.
Longer term, however, Walewicz remains extremely bullish on the company’s prospects.
“Trimel is entering a tremendous growth phase – 2016 will be the launch year of Natesto in Canada and the first full year of U.S. Natesto sales,” says the analyst. “Over the next 12 months, we expect investors to look into 2017 – a 10.6x multiple of our 2017E EBITDA gives a valuation of C$1.45. Tefina is not in our model, and any material progress in the Tefina program represents upside to our forecast.”
Natesto is a testosterone nasal gel for replacement therapy in men for conditions associated with a deficiency or absence of endogenous testosterone (hypogonadism). Last December, Trimel announced a deal Endo International (NASDAQ:ENDP, TSX:ENL) which granted the latter the exclusive rights to market Natesto in the United States and Mexico. Trimel’s product candidate Tefina is a treatment for Female Orgasmic Disorder.