Catalyst Pharma To Buy Back $40M In Stock; Shares Gain Pre-Market

Shares of Catalyst Pharma rose more than 3% in the pre-market session after the commercial-stage biopharmaceutical company announced its stock repurchase program of up to $40 million.

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Catalyst Pharma (CPRX) intends to use existing cash on hand to fund the share repurchase program.

Catalyst Pharma CEO Patrick J. McEnany said, “We believe that our strong balance sheet, earnings power and borrowing capability have us well-positioned to successfully execute both on our recently announced strategic initiative to expand our product and pipeline portfolio of therapies to treat other rare diseases and on this share repurchase program.” (See Catalyst Pharma stock analysis on TipRanks)

Last week, the company reported 4Q results. Revenue, made up primarily of Firdapse sales, increased by $0.9 million year-over-year to $31 million, surpassing analysts’ estimates of $30.35 million. Catalyst Pharma posted adjusted earnings of $0.11 per share, up 57% year-over-year, and outpaced analysts’ expectations of $0.09 per share.

On March 17, H.C. Wainwright analyst Andrew Fein reiterated a Buy rating and a price target of $9 (106% upside potential) on the stock.

Fein believes “firdapse weathers the pandemic, as pipeline primed for expansion.”

Catalyst Pharma shares have surged 39.6% over the past year, while the stock still scores a Strong Buy consensus rating based on 3 unanimous Buys. That’s alongside an average analyst price target of $7.17, which implies 64% upside potential to current levels.

On top of this, Catalyst Pharma scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.