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Why Dermira Stock Is Soaring More than 80% Today

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Mar. 18 2019, Published 6:22 p.m. ET

Share price movements

Today, Dermira (DERM) is trading close to $12.85, ~87.87% higher than its previous closing price, with a market capitalization of $292.48 million. The company is trading 114.19% higher than its 52-week low of $6.00 and 7.15% lower than its 52-week high of $13.84. Because its market cap is lower than $300 million, Dermira is considered a microcap stock, meaning that it’s riskier compared to large-cap stocks or the broader market.

Today, Dermira issued a press release announcing favorable top line results from its Phase 2b trial evaluating three dosages of the investigational therapy lebrikizumab in moderate to severe atopic dermatitis indications.

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According to Dermira’s investor presentation, the company expects to initiate a Phase 3 trial for lebrikizumab in late 2019, while it’s expected to release its top line results from this program in the first half of 2021. According to the company’s investor presentation, Dermira is targeting a large biologic atopic dermatitis market, which is expected to be worth $14.8 billion by 2025.

In its fourth quarter, Dermira reported revenue of $2.24 million, a YoY (year-over-year) rise of 67.01% and $1.01 million higher than the consensus estimate. The company, however, missed the consensus EPS estimate by $0.01 in the fourth quarter.

Based on its closing price on March 17, Dermira had reported returns of -14.29% in the last week, -5.52% in the last month, and -36.73% in the last quarter. The company had reported returns of -34.48% in the last half year, -33.33% in the last year, and -4.87% year-to-date.

Analysts’ recommendations and target prices

Analysts’ 12-month consensus recommendation for Dermira as of March 18 is a “buy.” Their 12-month consensus target price for the company is $17.22, which is 34.01% higher than its trading price of $12.85. The highest target price estimate for the company is $25, and the lowest target price estimate is $10.

Of the ten analysts covering Dermira on March 18, three have rated the company as a “strong buy,” five have rated it as a “buy,” and two have rated it as a “hold.”

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