Sarepta sees slight bounce back after Cantor calls selloff unwarranted

Shares of Sarepta Therapeutics are bouncing back slightly following yesterday’s 11% selloff. The weakness yesterday stemmed from Tuesday’s night capital raise as well as the resignation of FDA Commissioner Scott Gottlieb, and, to a lesser extent, a new short report, Cantor Fitzgerald analyst Alethia Young told investors last night in a research note. On the short report, the analyst disagrees with her understanding of its key points, and particularly thinks increasing the betasarcoglycan protein will lead to functional change over time. Sarepta has a clear lead in Duchenne muscular dystrophy gene therapy and its data has set a high bar for competition, Young wrote. Further, she thinks that if demand is available and companies can get capital they do. As such, the analyst is unconcerned by Tuesday’s equity raise. As it relates to Dr. Gottlieb’s departure, Young notes that Dr. Woodcock, who has been supportive of DMD, is still at the agency. All today, the analyst views yesterday’s selloff as unwarranted and reiterated Sarepta as one of her top 2019 picks. She has an Overweight rating on the shares with a $231 price target. Sarepta in late morning trading is up 2%, or $2.38, to $134.63.

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