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Why Did Shares of Verrica Pharmaceuticals Gain 15%?
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Why Did Shares of Verrica Pharmaceuticals Gain 15%?

Story Highlights

VRCA Shares leaped over 15% as many key executives from Verrica Pharmaceuticals’ top management engaged in informative Buys yesterday, buying shares worth a whopping $13.6 million.

Shares of Verrica Pharmaceuticals, Inc. (VRCA) gained over 15% on July 5 and have further gained another 3% during the pre-market trading hours today.

A number of key executives from Verrica Pharmaceuticals’ top management engaged in informative Buys yesterday, with numerous Form 4s filed with the SEC.

Strikingly, the insider buying comes within a week of the company announcing a public offering of 12 million shares at $2.10 per share.

Based in the U.S., Verrica Pharmaceuticals, Inc. is a clinical-stage medical dermatology company that develops and commercializes pharmaceutical products for the treatment of skin diseases.

Massive Insider Buys Lifts the Stock

Topping the Buy list was Paul B. Manning, who is a major shareholder (greater than 10% ownership) and Director of the company. Yesterday, he made an informative Buy of 4,761,904 shares of the stock worth $10 million at $2.10 price levels.

Perceptive Advisors LLC, which also owns a 10% stake in VRCA, snapped up 1,428,571 shares for $3 million at the same price level.

Furthermore, another Director, Stalfort Sean, made a smaller Buy of 238,095 shares worth $500,000.

Some more smaller Buys were also made by the senior level management. President, CEO, and Director, Ted White, and CMO, Gary Goldenberg, also made informative Buys of VRCA stock worth $50,000 each.

Wall Street’s Take on Verrica

The Wall Street community is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on three Buys and two Holds. The average Verrica Pharmaceuticals price target of $11.50 implies 360% upside potential to current levels.

Conclusion

Shares of Verrica Pharmaceuticals have lost almost three-quarters of their market capitalization over the past six months.

In fact, most of the share price decline took place on May 25, following the news that the U.S. Food and Drug Administration (FDA) did not approve the company’s medicine VP-102 to treat a viral skin disease called molluscum contagiosum (MC).

Intense insider trading indicates that perhaps there is some good news driving the optimism within the top management at VRCA.

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