On Friday, H.C. Wainwright adjusted its price target for Lexaria Bioscience (NASDAQ:LEXX) to $7.00, down from the previous target of $10.00, while maintaining a Buy rating on the company's shares. With the stock currently trading at $1.82, analyst targets range from $8 to $12, suggesting significant upside potential. According to InvestingPro, the company maintains a strong balance sheet with more cash than debt, though it's currently experiencing rapid cash burn. The adjustment follows Lexaria Bioscience's announcement of positive partial final results from its human pilot study #3 (GLP-1-H24-3), which tested an oral version of DehydraTECH-processed tirzepatide against the conventional injected Zepbound.
The study reported a significant reduction in adverse events when using the DehydraTECH-tirzepatide oral capsule compared to Zepbound, with a 47% reduction overall. Notably, gastrointestinal-related adverse events were reduced by 54%. While the company's market capitalization stands at $31.95 million, InvestingPro analysis reveals several additional insights about the company's financial health and market position, with 5 more exclusive ProTips available to subscribers. In terms of efficacy, DehydraTECH-tirzepatide demonstrated a comparable overall reduction in blood glucose levels and similarly increased levels of insulin over the 8-day observation period as Zepbound.
H.C. Wainwright's analyst believes these preliminary results are highly encouraging and indicate a promising outlook for the final data readout. Lexaria's management has indicated plans to expand the study to include a fifth arm, which will involve oral DehydraTECH-tirzepatide, in the ongoing study GLP-1-H24-4.
The firm's current estimated market value is $180 million, or $7 per share, leading to the reiteration of the Buy rating and the revised 12-month price target. The study's findings and the subsequent price target adjustment reflect Lexaria's ongoing research and development efforts in the pharmaceutical sector. Despite showing strong revenue growth of 77.6% over the last twelve months, the company remains unprofitable with a negative EBITDA of $7.17 million, highlighting the early-stage nature of its development programs.
In other recent news, Lexaria Bioscience reported fiscal year 2024 financial results, disclosing revenues of $0.5 million and a net loss of $5.8 million. The company also strengthened its cash position to approximately $11.2 million by issuing 1.6 million shares of common stock in a registered direct offering. H.C. Wainwright has maintained a Buy rating for Lexaria Bioscience.
Shareholders recently approved board and auditor selections with Malone Bailey LLP appointed as the company's auditors with a 98% approval. Executive compensation was also approved with a 97% majority. In addition, Lexaria Bioscience announced significant changes in its executive management and the establishment of a Scientific Advisory Board.
The company has made significant strides in its research and development, reporting positive results from the WEIGHT-A24-1 diabetes animal study and the initiation of a study to track the biodistribution of DehydraTECH-enabled semaglutide molecules in rodents. These are the recent developments in Lexaria Bioscience's operations.
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