Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Trevena Blasted Nearly 17% Higher on Monday

By Eric Volkman – Sep 14, 2020 at 7:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

An analyst initiates coverage on the stock with an unequivocal buy recommendation.

What happened

Shares of Trevena (TRVN -0.91%) shot higher on Monday following a very bullish analyst report. Guggenheim initiated coverage on the stock, with prognosticator Dana Flanders rating it a buy with a price target of $5.00. Even after Monday's price hike, that level still implies potential upside of 140%.

So what

Trevena is about to go to market with Olinvyk. This opioid received Food and Drug Administration approval last month for adult patients who suffer from acute pain serious enough to warrant the use of an intravenous opioid. It has the green light for use in hospitals or other controlled clinical settings.

Close-up of an IV drip.

Image source: Getty Images.

This makes Olinvyk an exciting and innovative new entry in the pain management segment. In clinical trials, it demonstrated very fast-acting effects, relieving such pain in two to five minutes in some cases.

Trevena plans to roll out Olinvyk in the fourth quarter of this year. Those very encouraging trial results could ultimately make it a blockbuster drug. Flanders is estimating it will reap sales of $1 million in 2020 -- a level that will rise sharply to $16 million in 2021 and $171 million in 2025.

Now what

Like many biotechs, Trevena is young and has no experience getting a product to market; Olinvyk will be its first. While the drug certainly has great potential in a segment that has been rather overlooked, investor caution is warranted.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Trevena, Inc. Stock Quote
Trevena, Inc.
TRVN
$0.15 (-0.91%) $0.00

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
326%
 
S&P 500 Returns
102%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.