Revance Theraputics (RVNC) Pipeline is Underappreciated - Guggenheim

Guggenheim analyst, Louise Chen, believes Revance Therapeutics' (NASDAQ: RVNC) pipeline prospects are underappreciated. She expects five launches over five years beginning in '19 that should drive upward earnings revisions and multiple expansion to levels not reflected in consensus expectations. No change to Buy rating or $55 PT.

The launches include:

1) RT001, topical for Crow’s Feet Lines in '19

2) RT002, injectable for glabellar Lines in ’20

3) RT001, topical for hyperhidrosis in ’21

4) RT002, injectable for Cervical Dystonia in '22/'23

5) Additional therapeutic launches in ‘23+

That said, she cut her EPS projections after RVNC reported 4Q15 EPS of ($0.83), which was $0.03 above consensus but $0.08 below her estimate. RVNC is a development stage company, and she believes pipeline advancements are more important than quarterly earnings. The company gave '16 guidance, which included a ramp-up in operating expenses from $73MM in '15 to $100MM at the midpoint for '16, driven by the initiation of new trials as it advances its pipeline.

Nearer term, potential catalysts include:

1) 2Q16 - RT001, first trial, Phase 3 data for Crow’s Feet

2) 1H16 - Report top-line data for RT002 in Cervical Dystonia

3) 2H16 - Initiate larger Phase 2 trial for RT001 for hyperhidrosis

4) 2H16 - Initiate Phase 3 program for RT002 for glabellar lines

5) '17 – RT001, second trial, Phase 3 data for Crow’s Feet

6) '17 – RT002, Phase 3 data for Glabellar Lines

7) '19 – RT001, Approval and Launch for Crow’s Feet

8) '20 – RT002, Approval and Launch for Glabellar Lines

9) '21 – RT001, Approval and Launch for Hyperhidrosis

10) '22/'23 – RT002, Cervical Dystonia

For an analyst ratings summary and ratings history on Revance Therapeutic click here. For more ratings news on Revance Therapeutic click here.

Shares of Revance Therapeutic closed at $17.81 yesterday.

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