Verastem (NASDAQ:VSTM) Downgraded by Wall Street Zen to "Sell"

Key Points

• Wall Street Zen downgraded Verastem to “Sell” from “Hold,” although the broader analyst consensus remains “Moderate Buy” with an average price target of $13.83.
• Verastem reported better-than-expected quarterly results, including an adjusted loss of $0.35 per share versus the $0.43 estimate and revenue of $40.08 million versus $22.88 million expected.
• The stock opened at $7.44, while CEO Dan Paterson sold 20,871 shares under a pre-arranged trading plan; institutional investors own 88.37% of the company.

Verastem (NASDAQ:VSTM - Get Free Report) was downgraded by stock analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a report released on Saturday, Wall Street Zen reports.

Other equities research analysts also recently issued reports about the stock. Mizuho set a $13.00 target price on shares of Verastem and gave the stock an "outperform" rating in a research report on Monday, August 10th. Royal Bank Of Canada set a $14.00 price target on shares of Verastem and gave the company an "outperform" rating in a research report on Tuesday, July 7th. Weiss Ratings upgraded Verastem from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Friday, September 4th. HC Wainwright reissued a "buy" rating and set a $18.00 price objective on shares of Verastem in a report on Friday, September 11th. Finally, BTIG Research reissued a "buy" rating and issued a $18.00 price objective on shares of Verastem in a research note on Friday, September 11th. One equities research analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat, Verastem presently has a consensus rating of "Moderate Buy" and an average price target of $13.83.

Verastem Price Performance

Shares of VSTM opened at $7.44 on Friday. Verastem has a 12-month low of $3.43 and a 12-month high of $10.82. The business's fifty day moving average is $6.79 and its 200 day moving average is $5.63. The company has a quick ratio of 2.22, a current ratio of 2.25 and a debt-to-equity ratio of 1.48. The stock has a market cap of $673.77 million, a P/E ratio of -2.80 and a beta of 0.32.

Verastem (NASDAQ:VSTM - Get Free Report) last announced its quarterly earnings results on Thursday, August 6th. The biopharmaceutical company reported ($0.35) EPS for the quarter, beating analysts' consensus estimates of ($0.43) by $0.08. Verastem had a negative net margin of 231.59% and a negative return on equity of 467.49%. The business had revenue of $40.08 million during the quarter, compared to analyst estimates of $22.88 million. Sell-side analysts anticipate that Verastem will post -1.56 earnings per share for the current fiscal year.

Insider Activity

In other news, CEO Dan Paterson sold 20,871 shares of the stock in a transaction dated Monday, June 22nd. The shares were sold at an average price of $4.18, for a total value of $87,240.78. Following the completion of the sale, the chief executive officer owned 591,242 shares in the company, valued at $2,471,391.56. This represents a 3.41% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 26,262 shares of company stock valued at $111,897. Corporate insiders own 1.94% of the company's stock.

Institutional Investors Weigh In On Verastem

Institutional investors have recently added to or reduced their stakes in the company. Royal Bank of Canada grew its stake in Verastem by 15.3% during the first quarter. Royal Bank of Canada now owns 110,729 shares of the biopharmaceutical company's stock valued at $587,000 after acquiring an additional 14,683 shares in the last quarter. Seven Fleet Capital Management LP purchased a new stake in Verastem in the 4th quarter worth approximately $117,000. Bank of New York Mellon Corp lifted its stake in Verastem by 31.8% in the 1st quarter. Bank of New York Mellon Corp now owns 161,707 shares of the biopharmaceutical company's stock worth $857,000 after purchasing an additional 39,018 shares in the last quarter. Hsbc Holdings PLC bought a new position in Verastem in the 1st quarter valued at $210,000. Finally, ADAR1 Capital Management LLC bought a new position in Verastem in the 1st quarter valued at $377,000. 88.37% of the stock is owned by institutional investors.

Verastem Company Profile

Verastem Oncology is a biopharmaceutical company focused on developing and commercializing targeted therapies for cancers driven by abnormalities in the RAS/MAPK signaling pathway. The company's research is aimed at addressing cancers with limited treatment options, including ovarian cancer and other solid tumors.

Verastem's principal products include avutometinib, a RAF/MEK pathway inhibitor, and defactinib, a focal adhesion kinase (FAK) inhibitor. The company has studied these therapies both individually and in combination, with the goal of improving cancer-cell response and overcoming treatment resistance.

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