Verastem (NASDAQ:VSTM) Shares Down 7% - Here's What Happened

Key Points

• Verastem shares fell 7% to approximately $7.68 during Tuesday trading, with volume below the stock’s average session level.
• Analysts remain generally positive, with a consensus “Moderate Buy” rating and an average price target of $13.83, although Jefferies recently cut its target from $15 to $8.
• The company exceeded quarterly expectations, reporting an adjusted loss of $0.35 per share versus a forecasted loss of $0.43 and revenue of $40.08 million versus $22.88 million expected; meanwhile, CEO Dan Paterson sold 44,121 shares under a pre-arranged trading plan.

Verastem, Inc. (NASDAQ:VSTM - Get Free Report) shares were down 7% during trading on Tuesday. The company traded as low as $7.66 and last traded at $7.6750. 1,573,566 shares were traded during mid-day trading, a decline of 30% from the average session volume of 2,262,950 shares. The stock had previously closed at $8.25.

Analyst Upgrades and Downgrades

Several brokerages have recently weighed in on VSTM. Weiss Ratings raised Verastem from a "sell (e+)" rating to a "sell (d-)" rating in a research report on Friday, September 4th. Jefferies Financial Group lowered their price target on Verastem from $15.00 to $8.00 and set a "buy" rating for the company in a report on Tuesday, June 23rd. Wall Street Zen raised Verastem from a "sell" rating to a "hold" rating in a report on Sunday, September 27th. Guggenheim set a $12.00 price objective on shares of Verastem and gave the stock a "buy" rating in a report on Friday, August 7th. Finally, BTIG Research restated a "buy" rating and set a $18.00 price objective on shares of Verastem in a research report on Monday, October 5th. Ten investment analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus target price of $13.83.

Verastem Stock Down 8.5%

The company has a market capitalization of $683.30 million, a PE ratio of -2.85 and a beta of 0.39. The company has a current ratio of 2.25, a quick ratio of 2.22 and a debt-to-equity ratio of 1.48. The firm has a 50 day simple moving average of $7.47 and a two-hundred day simple moving average of $5.87.

Verastem (NASDAQ:VSTM - Get Free Report) last posted its quarterly earnings results on Thursday, August 6th. The biopharmaceutical company reported ($0.35) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.43) by $0.08. The firm had revenue of $40.08 million during the quarter, compared to analysts' expectations of $22.88 million. Verastem had a negative net margin of 231.59% and a negative return on equity of 467.49%. Research analysts expect that Verastem, Inc. will post -1.55 EPS for the current year.

Insider Activity

In other news, CEO Dan Paterson sold 44,121 shares of the stock in a transaction that occurred on Thursday, October 1st. The shares were sold at an average price of $8.00, for a total value of $352,968.00. Following the sale, the chief executive officer directly owned 652,712 shares in the company, valued at $5,221,696. This represents a 6.33% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 48,044 shares of company stock valued at $381,484 over the last quarter. 1.94% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of VSTM. Seven Fleet Capital Management LP acquired a new position in shares of Verastem in the fourth quarter worth $117,000. Hsbc Holdings PLC purchased a new stake in shares of Verastem in the first quarter valued at $210,000. ADAR1 Capital Management LLC acquired a new stake in shares of Verastem during the first quarter valued at $377,000. Quantinno Capital Management LP acquired a new stake in shares of Verastem during the first quarter valued at $394,000. Finally, Knott David M Jr acquired a new stake in shares of Verastem during the first quarter valued at $551,000. 88.37% of the stock is currently owned by institutional investors and hedge funds.

Verastem Company Profile

Verastem Oncology NASDAQ: VSTM 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 lead product, avutometinib, is a treatment targeting the RAF/MEK signaling pathway and is marketed in the United States under the brand name Avmapki for certain patients with recurrent low-grade serous ovarian cancer.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.