What happened

Geron (NASDAQ:GERN), a small-cap cancer-focused company, saw its shares briefly spike by a healthy 15.3% in early morning trading today. What drove this double-digit move northward?

Shares perked up in response to an overwhelmingly positive note by BTIG analyst Thomas Shrader, who initiated coverage on the biotech with a buy rating, rolling out a handsome $4.00 price target in the process. While the stock has pulled back since its white-hot start to today's trading session, it remains up by a healthy 7.25% as of 11:11 a.m EST.

A brown paper rocket set to look like it's shooting higher on a white, hand-drawn chart, set against a light-blue background.

Image source: Getty Images.

So what

Shrader's stately price target implies that Geron's shares could more than quadruple in value over the next 12 months. That's an extremely optimistic assessment, to put it mildly. But there is a solid rationale behind this upgrade. 

As Shrader pointed out in his note to investors this morning, Geron's stock may have been unfairly "left for dead" by investors after Johnson & Johnson (NYSE:JNJ) decided to hand back the rights to the duo's blood cancer drug imetelstat last year. Imetelstat, after all, has gone on to show some encouraging signs of efficacy in both myelodysplastic syndromes and advanced myelofibrosis since J&J's departure. 

Check out the latest Geron earnings call transcript.

Now what

Now, the drug's mid-stage data readouts were far from a slam dunk in either case, but there was arguably enough meat on the bone to warrant J&J staying the course. Backing up this assertion, the former clinical lead for imetelstat at J&J's biotech wing Janssen, Aleksandra Rizo, M.D., Ph.D., recently decided to sign on as Geron's chief medical officer.

This top-shelf hire seems to indicate that imetelstat really does have a viable path forward and that the company wasn't simply paying lip service to its shareholders after J&J bolted. It's hard to imagine such a decorated and talented individual leaving a titan of the industry for a sinking ship.