One of the biggest winners on Friday was a relatively unheard-of biotech stock which made a name for itself in the orthopedic market. Anika Therapeutics (NASDAQ: ANIK) saw its shares surge by over 35.2% over the course of the day after the company released financial figures which surpassed Wall Street’s expectations.
Total revenue for the biotech stock rose by 11% to $29.7 million, a reasonable improvement from the $26.8 million seen in Q3 2018. From this figure, net income has reached $9.2 million, an improvement from the $7.6 million seen in the same time last year. While these revenue figures seem quite low considering Anika’s $1 billion market cap, giving the stock an aggressive 57.6 price-to-earnings ratio (P/E), revenues are expected to ramp up considerably over the next year now that the company’s building out its salesforce.
“Anika delivered double-digit revenue and earnings growth in the third quarter on the strength of growing global demand, Anika’s expanding commercial platform, and continued fiscal discipline,” said Joseph Darling, President and Chief Executive Officer of Anika Therapeutics. “The strength of our results in the third quarter is a testament to the hard work of the entire Anika team and reflects our continued progress towards executing our five-year strategic plan to transform Anika into a global commercial company focused on joint preservation and restoration.”
Other promising news for the company includes an 11% year-over-year increase in revenues from global sales coupled with some changes in the company’s management team. Unlike other biotech stocks that often have explosive upside potential when it comes to developing drug candidates, Anika Therapeutic’s likely doesn’t carry a similar upside considering that it doesn’t work on developing drugs.
Instead, the company focuses on developing orthopedic products, which don’t have the same drastic upside potential as most pharmaceutical drugs do. However, that also makes Anika a bit more of a stable biotech stock in contrast to it’s peers, with these types of price jumps being uncommon for the company.
In response to the news, shares of Anika jumped by 35.2% over the course of the day, reaching a new all-time high in the process. Out of the handful of analysts covering the stock, which there are only a few, the consensus is equally split between hold, overweight, and buy ratings. Overall, the three analysts covering the stock are now estimating that 2020 revenues for Anika Therapeutics will hit $117 million. However, none of them have changed their price target for the stock, maintaining at $54, although its likely that this figure will be updated following this recent price jump.
However, prospects seem to be positive for the company, even before it announced it had surpassed financial expectations. Time will tell what happens to the company now that its stock has reached a new all-time record.
Anika Therapeutics Company Profile
Anika Therapeutics Inc is an orthopedic medicines company. It is committed to improving the lives of patients with degenerative orthopedic diseases and traumatic conditions with clinically meaningful therapies. The company’s product profile includes Orthobiologics, Dermal, Surgical and other of which Orthobiologics products generates maximum revenue to the company. – Warrior Trading News
