Mizuho Remains Bullish on OraSure (OSUR) Ahead of Catalyst Despite AbbVie Termination

Mizuho Securities analyst Eric Criscuolo reiterated an Outperform rating and $8 price target on OraSure Technologies (NASDAQ: OSUR) with shares under pressure after the company and AbbVie (NYSE: ABV) jointly agreed to terminate the HCV co-promote agreement. Despite the setback, he sees two large potential catalysts in the near-term tht help keep them bullish.

"We believe it was well known that the agreement was not having the impact that both companies hoped it would," Criscuolo commented. "The biggest negative as we see it is the removal of the rest of the licensing revenue- ~$35mm remained until the end of 2019. Given the performance of the co-promote, we don't think the removal of ABBV will have a significant impact on HCV test sales."

On the potential catalysts, the analyst highlighted: "A potential contract with a foreign government for HCV testing could be OSUR’s largest HCV contract ever. Financial details were not disclosed, but we think it could readily be in the $5mm-$10mm range. A new supply agreement for the DNA testing kit should be announced soon as well. We expect to see robust demand in this space."

For an analyst ratings summary and ratings history on OraSure Technologies click here. For more ratings news on OraSure Technologies click here.

Shares of OraSure Technologies closed at $5.91 yesterday.

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