In a note on Tuesday, Liberum said the pharma and services company was “likely to be a relative outperformer through coronavirus related supply chain disruption” as the firm supplied “medicines of high importance”.
“We believe that any impact will be strictly one-off in nature and not affect future year profitability. As such, we expect Clinigen to outperform the broader market in relation to the coronavirus risk”, the broker added.
Analysts also retained their 780p price target on the stock, saying the company’s shares were now “unequivocally cheap” and there were “a couple of important catalysts due in the next 3-6 months” which they expected to re-rate the price.
The broker also said they believed the market was attributing “zero value” to the potential upside from two on-going clinical trials at Iovance Biotherapeutics, with which Clinigen has a supply agreement.
“Our risk-adjusted valuation of this opportunity is worth £1.08 per share. Given we expect these two studies to read-out within the next 6 months we see them as positive catalysts for the shares with next to no downside from a negative outcome and at least 12% upside from a positive outcome”, Liberum said.
The shares jumped 2.4% to 650.5p in mid-morning trading.