What happened

A glowing research note was the catalyst behind the bull run on Veru (VERU -7.18%) shares on Friday. The biotech's stock closed nearly 14% higher on that fresh blast of optimism.

So what

The note was authored by Veru bull Leland Gershell of Oppenheimer. In a research note made public Friday morning, the analyst strongly reiterated his buy rating on the stock, along with his $26-per-share price target -- which is nearly three times its current level.

A researcher studying a sample in a petri dish.

Image source: Getty Images.

Although Gershell is optimistic about the biotech company's pipeline -- notably its impressive VERU-111 that could potentially treat both prostate cancer and COVID-19 -- he finds larger potential elsewhere. Essentially, he's arguing that due to the stock's low valuation investors are getting several Veru development programs for free.

"While most would likely agree that the sources of greatest potential value for Veru are its late-stage candidates for breast and prostate cancer, pieces of the story not to be ignored are the commercial FC2 business as well as Tadfin, on track to launch for [benign prostatic hyperplasia] by early 2022," he wrote.

The key product of Veru's business unit, The Female Health Company, is the FC2 female condom. Tadfin is a pipeline drug that targets prostate and urinary tract afflictions in men.

Now what

Since most eyes watching Veru are tracking the progress of VERU-111, it's good to get a reminder that the company's fate isn't entirely tied to that program. Gershell's argument is a valid one, and it's clearly landing with investors.