This analyst just raised his price target on Cipher Pharma

Stifel analyst Justin Keywood raised his target on Cipher Pharmaceuticals (Cipher Pharmaceuticals Stock Quote, Chart, News, Analysts, Financials TSX:CPH) to C$22.00 from C$21.00 in a May 12 sales analysis, maintaining a “Buy” rating.

Keywood said Cipher’s cash generation and balance-sheet rebuild leave it positioned to repeat the value creation seen from its 2024 acquisition of Natroba.

“The set-up is favourable for ‘Rinse & Repeat’ value creation and de-risked with shareholder alignment,” Keywood said, noting the CEO owns about 40% of the company.

Cipher reported Q1 revenue of $12.5-million, in line with Keywood’s $12.3-million estimate. Natroba and Spinosad sales were $6.9-million, up 3% year-over-year, while Adjusted EBITDA of $7.7-million beat his $6.4-million forecast.

Keywood said Natroba’s 87% gross margin produced $4.4-million of Adjusted EBITDA, or about 57% of consolidated EBITDA. He said Cipher’s free cash flow remains strong, supported by about US$125-million of tax-loss carryforwards.

The analyst said Cipher could have about US$115-million of dry powder by Q4, including cash and untapped debt facilities, giving it capacity to pursue dermatology-focused acquisitions or in-licensing deals that would leverage its U.S. sales force.

Keywood also said Cipher’s new digital marketing strategy for Natroba could support organic growth, particularly around the back-to-school head-lice season in July and August.

He expects 2026 revenue of $54.3-million, up 7.7% year-over-year, and Adjusted EBITDA of $29.4-million.

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