A 10% lift to an analyst's stock price on Soleno Therapeutics (SLNO 1.47%) provided some nice lift to the biotech's shares on Thursday. They closed the day's trading session nearly 2.4% higher, more than double the percentage-rate increase of the S&P 500 index.
The stock remains a buy
Well before market open that day, Guggenheim healthcare analyst Debjit Chattopadhyay upped his price target on Soleno to $44 per share from his previous $40. In doing so, he maintained his buy recommendation on the shares. The new level implies nearly 12% upside to the stock at its latest closing price.
Chattopadhyay's latest research note on the company wasn't publicly available, so we can't ascertain the factors behind his price-target raise.
Soleno is a clinical-stage biotech that focuses on the treatment of rare diseases. Its leading drug candidate, Diazoxide Choline (DCCR), is a once-daily oral medication for patients with Prader-Willi Syndrome (PWS), a genetic disorder that can manifest in a set of physical, mental, and behavioral difficulties. Among these are a tendency to overeat.
In September, Soleno reported that DCCR met both its primary and secondary endpoints in a clinical trial involving 77 patients. Subsequently, the company said it would file a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA) for the indication.
Third-quarter disappointment
However, less than two months later, Soleno published its third-quarter results, and investors couldn't ignore the fact that the company's net loss was notably worse than the average analyst estimate. That situation could change dramatically, though, if DCCR receives the FDA's nod in the near future.
