PharmaMar corrects up to 5% after rally by Aplidin

PharmaMar corrects up to 5% after rally by Aplidin

PharmaMar cuts its good streak on the stock market this Thursday. Its shares (listed on the Ibex 35 ) today suffer cuts of up to 4.7% in their price after three days of marked increases, supported by the expectations created by Aplidin, the drug against covid-19 that the company is developing biotechnology.

The shares of the old Zeltia have reached a minimum intraday price this session at 102.5 euros, compared to the 107.6 euros in which they ended yesterday, a day in which they revalued by 1.2% despite the strong fluctuations that suffered.

Thus, PharmaMar added three days of strong earnings. Between Monday and Wednesday it rose close to 25 percentage points on the floor, reaching maximum prices not seen since the beginning of November . A rally that puts the brakes on this Thursday before the downward pressure that the entire Spanish stock market suffers .

Aplidin expectations
The biggest rise was recorded on Tuesday, when it shot up 21.1% in what was its best day on the stock market since September 2019.

Behind these meteoric stock market rallies are the good feelings created by Aplidin (plitidepsin), the drug that PharmaMar is developing against the coronavirus and which, according to the scientific journal Science , almost completely reduces the viral load in the lungs .

The Galician pharmaceutical company is waiting for the regulatory authorities to allow it to carry out the third (or final) phase of the clinical trial with Aplidin. In mid-October it announced that phase II (or intermediate) gave “positive results” by showing “a notable reduction in viral load” of covid-19 in hospitalized people.

Despite today’s declines, PharmaMar shares accumulate a revaluation of close to 50% so far this year (they started 2021 at 71 euros), which is why they are positioned as the most bullish on the Ibex in the annual ranking .

What do analysts recommend?
Given today’s correction, the question seems clear: will PharmaMar resume the stock market rises? Does it still have potential? “Really if we look at the target price, it would have barely any margin or very little, unless it started to be overvalued,” says analyst Ismael de la Cruz.

The Bloomberg market consensus gives the company a twelve-month average target price of 101.33 euros per share, that is, lower than the current one.

Thus, three of the analysts collected (or half of the total) give a ‘hold’ recommendation on the value, while two (33.3%) choose to ‘buy’ and only one (the remaining 16.7%) , for sale’.

However, De la Cruz believes that PharmaMar will soon try to overcome the resistance at 136.92 euros. In the same vein, the technical analyst and Ecotrader advisor, Joan Cabrero , points out, who thinks that the price could rise to 150 euros, that is, more than 40% from current levels.

“In the short [term] it has confirmed a pattern of turn in the form of a bullish island ,” explains Cabrero. “As long as it does not cancel the reversal implications of this pattern, for which it should (…) lose 82 euros, I understand that it could go up to 140-150 euros.”

However, the Ecotrader advisor advises waiting for PharmaMar stocks to approach the stop level and fill in the “gap” to the upside before buying.

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