Cardiol Therapeutics' (CRDL) stock price has risen by 87 percent on a YTD basis due to several positive catalysts, including the listing on NASDAQ. Cardiol Therapeutics stock reached a 52-week high of $4.25 on Sept. 7. What's Cardiol Therapeutics' stock price forecast?
Cardiol Therapeutics is a clinical-stage biotechnology company that's focused on the research and clinical development of anti-inflammatory therapies for the treatment of CVD (cardiovascular disease). CardiolRx is its key product, which is an oral formulation for the treatment of hospitalized COVID-19 patients with a history of risk factors for CVD.
Catalysts for Cardiol Therapeutics stock
The company was founded in 2017 and is headquartered in Oakville, Canada. Cardiol went public with an IPO on the Toronto Stock Exchange in December 2018. It started trading on NASDAQ under the ticker "CRDL" on August 10, 2021. The company sees this listing as a major milestone. NASDAQ is the premier global stock exchange for life science and biotechnology companies.
On Aug. 24, the company received approval from the FDA for its Investigational New Drug application to commence a Phase II trial to study the safety and tolerability of CardiolRx, as well as its impact on myocardial recovery in patients presenting with acute myocarditis. This was seen as a huge positive by many market participants.
CRDL stock forecast
The company is currently covered by just two Wall Street analysts and both of them have a buy rating on the stock. The consensus target price for the stock is $5, which implies an upside potential of 22.5 percent from the current price levels.
On Aug. 25, Raymond James raised the target price for CRDL stock to 5 Canadian dollars from 4.5 previously. Raymond James analyst Rahul Sarugaser thinks that the FDA’s approval for the Phase II study of CardiolR is a very positive step in its mission to address inflammatory heart disease with its pharmaceutical cannabidiol (CBD).
The analyst also thinks that 2022 will be an inflection point for CRDL. Sarugaser projects revenues of $1 million for CRDL in 2021 and $4 million in 2022. He also projects an EBITDA loss of $14 million and $13 million in 2021 and 2022, respectively.
Is CRDL a good investment?
The heart disease market is growing steadily. In this space, heart failure is the leading cause of hospitalization with healthcare costs exceeding $30 billion annually in the U.S. With its primary drug candidates, Cardiol has the opportunity to take up a sizable market share in this space. Cardiol’s COVID-19 CVD LANCER trial is coming to an end, while the Phase II trial for CardiolRx is underway and a positive outcome on this could propel the stock higher.
In May, Cardiol announced a $15 million bought deal public offering. There was high demand for the offering, which led the company to upsize it to $22 million. This reinforces a strong investor interest in the company’s stock.
However, as is usually the case, clinical-stage biotech companies are risky with no products on the market and no revenues. Therefore, investing in CRDL is high risk and is only suitable for investors with a high-risk appetite.