Panmure Liberum reiterated a 'buy' recommendation on Arecor Therapeutics PLC (AIM:AREC) with a price target of 251p after the company reported a stronger-than-expected cash position in its trading update earlier on Monday.
The broker said the update showed a “positive outturn” to 2025, with year-end cash of £6.1m, materially ahead of its £4.4m forecast, reflecting better returns from the wind-down of the Tetris distribution business.
Panmure said the closure of Tetris and the release of cash from non-core assets had transformed the business and sharpened management focus on its core value drivers.
Full-year revenue of £3.1m was slightly below the broker’s £3.4m estimate, although the cash outcome more than offset the modest revenue shortfall.
The broker said the cash balance was sufficient to fund operations until the first half of 2027, including preparation of AT278 for an investigational new drug submission.
Panmure highlighted progress under the co-development agreement signed with Sequel Med Tech in September, which it said put Arecor on track to start a phase II trial in 2026.
Positive negotiations on a broader development and commercialisation deal were described as the key near-term value driver for the shares.
In early trading, the shares were flat at 77.5p.