That's an interesting comment Lilly. I went back and checked when they did the revision in their valuation from 25 cents down to 11 cents prior to going to 13 cents. While I acknowledge all the points you make on progress by the company since then, your comment is missing a few things on delayed timelines which impacts cash flows and any DCF valuation which would be impacted by that:
They had earlier expected a deal and upfronts and milestones from it to happen in 2016 (now this is expected in 1H18). They had also expected Rett to get to market in 2019 (now expect 2021) and expected Fragile X to get to market in 2020 (now expect 2023). The royalty revenues have therefore also moved by 2-3 years. Also they did not have any capital raising assumption in their numbers for Neuren when they had it at 25 cents. Taken all that together makes sense that the target comes down as the biggest value driver in the short/medium term has to be the cash from the deal and the long term royalties once the product gets to the market.
NEU Price at posting:
7.0¢ Sentiment: Buy Disclosure: Not Held
(20min delay)