ZYNE stock has been on a tear in the stock market recently and much of that has to do with a highly bullish report from an analyst. Shares of Zynerba Pharmaceuticals, Inc. (NASDAQ:ZYNE) are up a whopping 130% over the past month.
Although one might be sceptical of bullish analyst reports, there appears to be more to the company and its products. Plenty of clinical trials of its drugs are going on and therein lies the big opportunity for the company to become a big player in its preferred niche.
The Rise
The Zynerba stock was on a tearing rally on Tuesday and rose by as much as 11.5% on a report by Jerry Isaacson, an analyst at Roth Capital. According to the report published by Isaacson, the Zynerba stock has been given a buy rating but what is more important is that the analyst has gone for a target price of $36. That target price reflects a 211% rise in price for the stock from where it closed on Monday.
Needless to say, ZYNE stock went on a tearing run as soon as the content of the reports surfaced. However, analysts’ reports and that too by one analyst can hardly ever be the reason behind the long term upside in a particular stock. The reasons for optimism are rooted elsewhere.
Clinical Trials
The optimism for the ZYNE stock lies in the fact that the company is now conducting clinical trials for some of its key drugs and the one with the biggest promise is Zygel. The drug is currently in the 3rd phase of clinical study and is meant for the treatment of Fragile X Syndrome. On top of that three parallel studies of the drug are going on that are all in their second phase.
The phase two studies are trying to determine Zygel’s effectiveness against conditions like developmental and epileptic encephalopathies (DEE), autism and refractory focal epilepsy in adults. In other words, a huge market is all set to be opened up if these trials prove to be successful. The results are expected soon.
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