Biotech stocks like Arcutis Biotherapeutics (NASDAQ:ARQT) tend to move up or down on a handful of key points. One of those came back to jab Arcutis in the backside like a measles shot used to, and investors took it poorly, sending shares down over 6% at the time of writing.
The word came from Jones Research, who pointed out that Arcutis was actually doing pretty well on some fronts. Indeed, its recent sales of Zoryve were on the rise, and Arcutis also managed to successfully raise some new equity, an extra $100 million worth.
All good news, but despite this, one point hung above Arcutis like the Sword of Damocles, and that was a loan agreement with SLR Investment Corp. (NASDAQ:SLRC). That agreement represented what Jones Research called “…near-term risk of technical default,” and the “significant additional capital” that Arcutis would need to push toward the break-even mark would likely only dilute equity further.
All may not be lost, however; Arcutis’ Zoryve managed to recently win a victory with the Food and Drug Administration (FDA), which allows Arcutis to start marketing Zoryve to children between the ages of six and 11. Previously, it could only market to those 12 and older, but this has opened up a new potential market. Zoryve is a treatment for plaque psoriasis, which is a skin-immune disease that hits around nine million people in the United States, or close to 3% of the population. The new age range may not mean many more new customers, but for those who need it, it will certainly be welcome.
What is the Target Price for ARQT Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on ARQT stock based on three Buys and three Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average ARQT price target of $16.60 per share implies 654.55% upside potential.
