Stock Alert for GTx Inc. (GTXI) " />

Stock Alert for GTx Inc. (GTXI)

GTx Inc. (GTXI) engages in the discovery, development and commercialization of small molecules that selectively target hormone pathways for the treatment of cancer and the side effects of anticancer therapy, cancer supportive care and other serious medical conditions. The Company’s newest product candidate is Capesaris (GTx-758), which is being developed for first line treatment of advanced prostate cancer. GTx-758 has the potential to achieve medical castration without causing bone loss or hot flashes. It is also developing Ostarine (GTx-024) and other selective androgen receptor modulators (SARMs) for the prevention and treatment of muscle loss in patients with cancer and for other muscle wasting diseases.  Additionally, GTXI is developing toremifene 80 mg for the reduction of fractures and treatment of other estrogen deficiency side effects of androgen deprivation therapy for prostate cancer.GTXI was incorporated in 1997 and is headquartered in Memphis, Tennessee. 

Share Statistics (23-June-11) FY 

2009

FY 

2010

%  

Chg

Q1 

2010

Q1 

2011

%  

Chg

Symbol GTXI Revenue, $Mn 14.73 60.61 311.5% 56.58 9.29 -83.6%
Current price $4.63 Gross marg. 91.2% 98.7% 8.2% 99.7% 97.8% -1.9%
52wk Range: $2.27-$6.86 Oper. margin 23.0% -31.2%
Avg Vol (3m): 324,402 Net margin -314.1% 25.2% -108.0% 78.4% -28.0% -135.7%
Market Cap. 239.46M
Shares Outstanding 51.72 EPS, $ -1.27 0.39 -130.7% 1.22 -0.05 -104.1%

Source: Reuters.com, SEC Filings.

Recent News

GTXI saw its shares plummet yesterday after it announced the pricing of its previously announced public offering of its common stock. The cancer drug developer said it intends to sell 10 million shares at $4.75 a share, a 9.2% discount to the stock’s closing price of $5.23 on Wednesday. It said the underwriters would have a 30-day option to buy another 1.5 million shares to cover any over allotments.

Subject to customary closing conditions, the transaction is expected to close on or about June 28. Citi and Jefferies & Co. Inc. have been mandated book-runners and underwriters for the offering.

GTXI expects to raise proceeds of $47.5 million before expenses.  The Company plans to use the net proceeds from the offering for clinical development and other research and development activities and for working capital and general corporate purposes.

Shares were boosted early in the week after the Memphis, Tenn.-based company announced the initiation of a Phase IIb clinical trial evaluating its oral Capesaris tablets against Lupron Depot for first line treatment of advanced prostate cancer.

“Acting selectively through estrogen receptor α, Capesaris has the potential to achieve medical castration without also causing several well documented problems of androgen deprivation therapy for prostate cancer such as hot flashes, bone loss and metabolic syndrome,” Thomas Keane MD, chairman and professor of Urology at the Medical University of South Carolina, and lead investigator of the multicenter Capesaris phase IIb clinical trial, commented in the release.  He said a new form of first line hormonal treatment that avoids some of the side effects of current ADT would be an important development.”

To determine the loading dose of Capesaris required to achieve medical castration in greater than 90% of patients within 28 days, GTXI intends to initiate an additional phase II study in advanced prostate cancer patients in second half of this year.  The Company also plans to advance Capesaris into a phase II study for second line therapy for patients with castration resistant prostate cancer who have failed LHRH therapy.

GTXI lost $0.60 to close Thursday’s trading at $4.63 per share. Nearly 4 million shares have traded hands during the session, versus the 10-day average volume of 282.43K.  The stock has been moving within a range of $2.27 – $6.86 over the past 52-weeks. The stock is currently trading below its 50-day moving average of $5.70 and above its 200-day moving average $3.59.

Visit GTXI at www.gtxinc.com

Financial Summary

GTXI posted a net loss of $2.6 million for the first quarter of 2011, versus a net income of $44.3 million for the same period in 2010.

Revenue for the quarter came in at $9.3 million, down from $56.6 million reported in the same period last year. Revenue for both periods included net sales of FARESTON (toremifene citrate) 60 mg, marketed for the treatment of advanced metastatic breast cancer in postmenopausal women and collaboration revenue from Ipsen Biopharm Ltd. Net sales of FARESTON were $1.2 million and $799,000 for the three months ended March 31, 2011, and 2010, respectively.

Revenue for the first quarter of 2011 included $8.1 million of collaboration revenue as a result of the termination of the Company’s license and collaboration agreement with Ipsen during March 2011. Revenue for the first quarter of 2010 included collaboration revenue of $922,000 from Ipsen and the recognition of $54.9 million of revenue due to the termination in the first quarter of a license and collaboration agreement for the Company’s SARM program.

Research and development expenses for the quarter ended March 31, 2011, were $7.3 million, compared to $7.7 million for the same period in 2010. Research and development expenses for the three months ended March 31, 2011, included a non-cash impairment charge of $1.6 million related to the Company’s toremifene 80 mg intangible asset following the decision to discontinue development of toremifene 80 mg. General and administrative expenses for the quarter were $4.7 million, as against $4.5 million for the same period in 2010.

GTXI’s cash, cash equivalents and short-term investments totaled $49.4 million at March 31, 2011.

Financial Strength (23-June-2011) Company Industry Sector S&P 500
Quick Ratio (MRQ) 15.99 2.70 2.09 0.71
Current Ratio (MRQ) 16.04 3.53 2.63 1.03
LT Debt to Equity (MRQ) 0.00 15.22 23.24 136.67
Total Debt to Equity (MRQ) 0.00 19.25 29.40 182.40
Interest Coverage (TTM) 5.91 1.60 18.18

Source: Reuters.com, SEC Filings.

Analyst Consensus

This is the consensus forecast among four polled investment analysts. Against the GTx Inc company.

Analyst Detail Buy Outperform Hold Underperform Sell No Opinion
Latest 2 0 1 1 0 0
4 weeks ago 2 0 1 1 1 0
2 months ago 1 0 2 1 1 0
3 months ago 0 0 3 1 1 0
Last year 0 0 4 1 1

The one analyst offering a 12-month price target expects GTXI share price to rise to 8.00 in the next year from the last price of 5.23.

Source: markets.ft.com

Consensus Estimates Analysis

# of Estimates Mean High Low 1 Year Ago
SALES (in millions)
Quarter Ending Jun-11 3 1.22 1.30 1.11
Quarter Ending Sep-11 3 1.19 1.30 1.00
Year Ending Dec-11 4 10.42 17.12 4.12 16.41
Year Ending Dec-12 3 14.48 31.88 2.57 21.82
EARNINGS (per share)
Quarter Ending Jun-11 3 -0.18 -0.17 -0.20
Quarter Ending Sep-11 3 -0.20 -0.18 -0.22
Year Ending Dec-11 4 -0.70 -0.60 -0.95 -0.90
Year Ending Dec-12 3 -0.75 -0.55 -0.99 -0.86
LT Growth Rate (%) 1 0.00 0.00 0.00 0.00

Technical Analysis

Source: http://stockcharts.com

GTXI is below the lower Bollinger Band, implying that it is currently extended to the downside from its recent trend.

The MACD for GTXI currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9-day moving average. Second, the MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower.

Comparative Analysis

Company Name Ticker Price per Mrkt. Cap. P/E P/S
June23-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
Novartis AG NVS 59.82 136.75B 10.84 10.44 2.35 2.31
Merck & Co. Inc. MRK 34.97 107.94B 9.38 9.08 2.29 2.31
Eli Lilly & Co. LLY 37.19 41.36B 8.71 10.00 1.76 1.80
Biotechnology Median 19.23 n/a 10.27 n/a
GTx Inc. GTXI 4.63 239.46M n/a n/a 16.84 16.54

Source: Thomson Financial

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