Zacks sees 600+% upside in vaping addiction drug maker Achieve Life Sciences

Zacks SCR thinks Achieve Life Sciences is massively undervalued / Photo: Shutterstock

In a recent report, Zacks Small-Cap Research (Zacks SCR) has made the case for its $30 per share target price for Achieve Life Sciences, which is seven times the last closing price. Achieve is a micro-cap company developing the world’s first treatment for vaping addiction.

Details

Zacks SCR values Achieve Life Sciences shares at $30 per share, a 620% premium to the Monday, November 18, closing price of $4.16 per share.

Zacks SCR attributes the upbeat valuation to significant developments in Achieve’s business over recent months. The company’s treatment for vaping addiction has received “breakthrough therapy” designation from the U.S. FDA, while other clinical trials are progressing ahead of schedule. Additionally, Achieve has revamped its leadership team and is now leaning toward independently commercializing its drugs after approval, rather than selling them to a strategic investor.

The Zacks SCR target price is the most bullish on Wall Street, with the average valuation among the eight analysts who track the stock, according to MarketWatch, at $15.60 per share, implying upside of around 270%.

Context

Achieve Life Sciences is the result of multiple mergers completed over 30 years. The company focuses on treatments for nicotine and vaping addiction, with its primary drug, cytisinicline, an alkaloid derived from plants. In July, the FDA designated it a “breakthrough therapy,” since it has no peers in existence globally. This designation allows for expedited approval, without the final phase of clinical trials. Currently, cytisinicline is being tested only on adults. However, Freedom Broker reports that, subject to FDA approval, the trials could be extended to include adolescents in 2025. Freedom Broker has also released a report on Achieve, where it explains its “buy” recommendation with a target price of $12 per share.

Note that the FDA has requested additional safety data on the long-term use of cytisinicline for smoking cessation, citing the potential for relapse among smokers, which may necessitate multiple treatment courses. Achieve plans to submit most of this data in the first half of 2025, meaning regulatory approval may not be forthcoming until the third quarter of 2026, according to Freedom Broker.