Look for strong 2017 from Knight Therapeutics, says Laurentian

With a “lumpy” business of pre-commercial products, investors shouldn’t read too much into Knight Therapeutics (Knight Therapeutics Stock Quote, Chart, News: TSX:GUD) current results, but should instead look at 2017 and beyond, says Laurentian Bank Securities analyst Joseph Walewicz.

Last Thursday, Knight Therapeutics reported its Q2, 2016 results. The company earned $4.44-million on revenue of $1.13-million.

“This past quarter marked our fourth successful equity raise in 28 months all at increasing valuations,” said CEO Jonathan Ross Goodman. “We hope to demonstrate that we are as ‘GUD’ at commercializing innovative pharmaceuticals that touch people’s lives as we are at raising money. To this end, we have deployed or committed over $300-million since our founding in low-risk, fair-return opportunities that will improve the health of Canadians and help build Knight into Canada’s leading specialty pharma company.”

Walewicz, who currently has a “Hold” rating and a one-year price target of $8.50 on Knight Therapeutics, says investors may have to wait a while, but better things are forming on the horizon for the company.

“Overall, GUD’s rapidly developing portfolio, strong balance sheet, and weak capital markets for specialty pharma companies all point to a strong 2017 for the company,” says Walewicz. “We continue to believe that the current market turmoil will present opportunities for well capitalized companies, including Knight, and we look forward to greater granularity on the company’s product launch plans for 2017+.”