Verastem (NASDAQ:VSTM) Shares Up 4.9% - Still a Buy?

Key Points

• Verastem's stock increased by 4.9% during mid-day trading, reaching $9.04, although trading volume was down by 56% compared to its average.
• Brokerages have generally rated Verastem favorably, with a consensus rating of "Moderate Buy" and an average price target of $13.29.
• The company reported better-than-expected earnings, with an EPS of ($0.39), surpassing estimates while revenues lagged behind expectations.

Verastem, Inc. (NASDAQ:VSTM - Get Free Report)'s stock price shot up 4.9% during mid-day trading on Tuesday . The stock traded as high as $9.06 and last traded at $9.04. 822,774 shares traded hands during trading, a decline of 56% from the average session volume of 1,852,134 shares. The stock had previously closed at $8.61.

Wall Street Analysts Forecast Growth

Several brokerages recently issued reports on VSTM. Wall Street Zen raised Verastem from a "sell" rating to a "hold" rating in a research report on Sunday, September 21st. BTIG Research reiterated a "buy" rating and set a $20.00 price target on shares of Verastem in a report on Tuesday, September 9th. B. Riley upgraded Verastem to a "strong-buy" rating in a report on Monday, August 25th. Royal Bank Of Canada lifted their price target on Verastem from $12.00 to $13.00 and gave the stock an "outperform" rating in a report on Friday, August 8th. Finally, Zacks Research upgraded Verastem to a "hold" rating in a report on Tuesday, August 12th. One investment analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $13.29.

Verastem Stock Performance

The stock has a market capitalization of $557.92 million, a P/E ratio of -2.76 and a beta of 0.89. The company has a 50 day simple moving average of $8.49 and a 200-day simple moving average of $6.86. The company has a debt-to-equity ratio of 2.06, a current ratio of 3.46 and a quick ratio of 3.44.

Verastem (NASDAQ:VSTM - Get Free Report) last issued its earnings results on Thursday, August 7th. The biopharmaceutical company reported ($0.39) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.64) by $0.25. The firm had revenue of $2.14 million during the quarter, compared to the consensus estimate of $6.01 million. On average, equities analysts forecast that Verastem, Inc. will post -3.02 EPS for the current year.

Hedge Funds Weigh In On Verastem

Hedge funds have recently made changes to their positions in the stock. Goldman Sachs Group Inc. grew its position in shares of Verastem by 236.9% in the first quarter. Goldman Sachs Group Inc. now owns 756,402 shares of the biopharmaceutical company's stock valued at $4,561,000 after purchasing an additional 531,873 shares in the last quarter. Jefferies Financial Group Inc. purchased a new position in shares of Verastem in the first quarter valued at $1,631,000. Nuveen LLC purchased a new position in shares of Verastem in the first quarter valued at $305,000. Bank of America Corp DE grew its position in shares of Verastem by 18.8% in the fourth quarter. Bank of America Corp DE now owns 77,165 shares of the biopharmaceutical company's stock valued at $399,000 after purchasing an additional 12,198 shares in the last quarter. Finally, Squarepoint Ops LLC purchased a new position in shares of Verastem in the fourth quarter valued at $92,000. 88.37% of the stock is currently owned by hedge funds and other institutional investors.

About Verastem

Verastem, Inc, a development-stage biopharmaceutical company, focuses on developing and commercializing drugs for the treatment of cancer in the United States. Its product candidates are Avutometinib, an orally available small molecule RAF/MEK clamp that inhibits the ras sarcoma RAF/MEK, ERK mitogen activated pathway kinase pathway which is involved in cell proliferation, migration, transformation, and survival of tumor cells; and Defactinib, an oral small molecule inhibitor of FAK and proline-rich tyrosine kinase for various solid tumors.

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