Corporate broker finnCap has reiterated its 19p price target for drug development company Poolbeg Pharma PLC (AIM:POLB, OTCQB:POLBF), a 144% premium to the current share price of 7.8p.
According to a research note, Poolbeg reported better-than-expected 2022 results in terms of costs, leading to a higher net cash balance of £16.2m, compared to the broker's forecast of £14.7m.
The company has made solid R&D progress while maintaining its capital-light operating model, positioning it with a strong balance sheet and a cash runway until 2025. FinnCap suggests that partnering revenues from licensing deals could extend Poolbeg's cash runway even further and provide additional flexibility for business development activities, potentially adding technologies or products to the R&D pipeline.
The research note also highlights that finnCap has increased its R&D costs assumptions for 2023 due to more R&D programmes, but end-year net cash remains healthy even without potential partnering revenue.