Aeterna Zentaris (TSX:AEZS) (NASDAQ:AEZS) stock is having a spectacular run on the market lately with a gain of over 25% in the past two weeks. Why the climb? It likely has to do with the company announcing that it was exploring long term strategic options, including selling itself.
In Monday’s trading, AEZS stock closed up 9.68% at $5.10 USD on NASDAQ after hitting a new 52-week high of $5.22 USD earlier in the session. Moreover, the stock is up more than 300% in a 12-month period.
AEZS Big Announcement: Possible Sale of the Company
On March 13th, 2019, Aeterna announced that it would consider various long term strategic options and decided to appoint Torreya as its financial advisor. This announcement was really unexpected and interesting, considering Torreya is a popular global investment bank for making large M&A deals in the biotech sector.
Potential pathways for Aeterna include expanding the licensing of its adult growth hormone deficiency (GHD) drug macimorelin beyond the United States and Canada. Another option involves finding new ways to monetize transactions relating to macimorelin.
Also, management is considering selling the company if it will positively serve its investors, especially now when things are looking good for AEZS on the market.
However, the company has not given any timeline for strategic review and mentioned that the final outcome may not result in anything.
This news has seemingly given a new boost to AEZS stock.
Aeterna’s Solid Financials
Aeterna’s bullish run in the market has persisted for a while now—a trend that can be traced to its impressive annual results. The highlight of Aeterna’s financials is the impressive year-over-year revenue growth totaling to $26.9 million in 2018, up significantly from $0.9 million for fiscal 2019.
Noticeably, the company reported $200,000 in macimorelin royalties during the latest quarter.
In January 2019, the company was given marketing authorization for macimorelin by the European Medicines Agency (EMA). It will be interesting to see if the company can find a capable partner to bring macimorelin in the European market.
The company’s 2018 $9.8 million income from operations was another phenomenal score with respect to the previous year’s loss of $23.1 million from operations. Investors were clearly thrilled by the year’s net income of $4.2 million, a far outcry from the net loss of $16.8 million suffered in 2017.
Investors can keep an eye on AEZS to see what news comes next from the company in regards to its potential sale or the launch of macimorelin in the European market.
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