Why Is Pain Treatment Focused Heron Therapeutics Stock Trading Higher Today?

Heron Therapeutics Inc HRTX reported Q3 sales of $31.43 million, missing the consensus of $32.75 million.

The company reported a Q3 EPS loss of $(0.17), lower than $(0.38) a year, and beating the consensus of $(0.29).

The company implemented a cost reduction plan to decrease operating expenses by 26% in 2023 compared to 2022, and full-year 2024 operating expenses to be around $108 million-$116 million.

The company sees FY23 sales of $123 million-$125 million compared to a prior range of $99 million-$103 million and a consensus of $124.61 million.

The company forecasts FY24 sales of $138 million-$158 million versus a consensus of $156.57 million.

Needham noted that the guidance parameters highlight the company's restructuring and cost reduction progress and map a path to operating cash flow breakeven by YE2024. 

EBITDA targets hinges on the stability of the Chemotherapy Induced Nausea and Vomiting franchise and the growth of Zynrelef, which should see a label expansion in early 2024 and a vial access needle modification in September 2024.

Needham maintains the Buy rating with a price target of $4 and expects it will take a few quarters of execution and improving sales to demonstrate progress towards the proposed profitability path.

Price Action: HRTX shares are up 61.40% at $0.87 on the last check Wednesday.