Somewhat of an outlier coronavirus stock, Ocugen (NASDAQ:OCGN) see-sawed in price on Monday. That followed a new analyst recommendation, which although very bullish, likely gave investors pause to think about the company's prospects.
Noble Capital analyst Robert LeBoyer initiated coverage of the stock with an unhesitant outperform (i.e., buy) recommendation. He also placed a $15 per share target price on the stock, which is more than double the level the shares closed at on Friday.
Like many Ocugen bulls, LeBoyer is most excited about Covaxin. This is the coronavirus vaccine candidate currently being developed by Bharat Biotech, the American company's partner in India, in collaboration with the Indian Council of Medical Research-National Institute of Virology.
As with the coronavirus vaccines that have been authorized by regulators in various jurisdictions across the world, Covaxin has demonstrated high efficacy in phase 3 testing, particularly in severe cases.
Ocugen holds the exclusive commercial rights to Covaxin in the U.S., so if the drug comes to market and is immediately deployed to fight the disease, LeBoyer's rosy view of Ocugen's future could be realized.
As always with biotech stocks, the key word is "if." Per the recommendation of the Food and Drug Administration, Ocugen will seek full Biologics License Approval (BLA) for Covaxin, rather than the originally planned Emergency Use Authorization (EUA). The BLA process is longer and more involved, so Covaxin might take quite some time to reach the market. Perhaps investors noted this sobering reality after being hit with the euphoria of the new analysis.