3 Reasons To Buy Alimera Sciences: B. Riley

Nano-cap pharma company Alimera Sciences Inc ALIM 6.35% could nearly triple in value for three key reasons, according to B. Riley FBR.

The Analyst

Analyst Andrew D’Silva initiated coverage of Alimera Sciences with a Buy rating and $2.75 price target.

The Thesis

Alimera is a leader in sustained-release ophthalmic technologies and should be bought by investors for three reasons, D’Silva said in the initiation note. (See the analyst’s track record here.)

D’Silva named the following as reasons for the bullish stance on Alimera:

• The company has shown consistent growth with its lead offeringm, Iluvien for the treatment of diabetic macular edema, since 2014. The therapy is a sustained release micro insert that can last for three years, so early adopters are now expected to come back for a second treatment cycle along with new patients receiving their initial treatment, the analyst said.
• Alimera submitted a Type 2 variation for Iluvien in Europe for uveitis, and approval is expected to come in the first half of 2019, D’Silva said. The data shown so far in pivotal studies is supportive of the therapy, despite uveitis being an orphan disease that affects around 200,000 patients across Europe.
• Revenue growth in 2018 should come in at a low-double digit rate, but is likely to ramp higher in 2019 and 2020, at which point Alimera should report a positive EPS, the analyst said.

Volatility in the stock could be seen over the coming years, but the risk-reward profile implies upside of nearly three times from current levels, which represents a significant opportunity for investors, according to B. Riley FBR.

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