H.C. Wainwright analyst Oren Livnat has maintained their neutral stance on VRCA stock, giving a Hold rating on April 3.
Oren Livnat has given his Hold rating due to a combination of factors influencing Verrica Pharmaceuticals. Despite impressive growth in YCANTH dispensed volume and a streamlined operational approach, there are concerns about the company’s liquidity position. The reduction in commercial footprint and operating expenses has been effective, but the uncertainty around how Verrica will navigate its financial constraints remains a critical issue.
While the potential for YCANTH in treating molluscum contagiosum and common warts is promising, and the VP-315 candidate shows intriguing possibilities for basal cell carcinomas, the company’s financial strategy to achieve breakeven is not yet clear. The current enterprise value may not fully reflect the potential of Verrica’s assets, but until there is more clarity on the company’s path to financial stability, the Hold rating is maintained. Livnat suggests that once there is better visibility on breakeven and strategic opportunities, there could be a more positive outlook on the stock.
In another report released on April 3, RBC Capital also maintained a Hold rating on the stock with a $2.00 price target.