Verastem (NASDAQ:VSTM) Shares Gap Up Following Better-Than-Expected Earnings

Verastem, Inc. (NASDAQ:VSTM) shares gapped up prior to trading on Friday after the company announced better than expected quarterly earnings. The stock had previously closed at $5.91, but opened at $6.65. Verastem shares last traded at $6.1750, with a volume of 869,797 shares changing hands.

The biopharmaceutical company reported ($0.35) earnings per share for the quarter, beating the consensus estimate of ($0.43) by $0.08. Verastem had a negative net margin of 391.17% and a negative return on equity of 486.40%. The company had revenue of $40.08 million during the quarter, compared to analyst estimates of $22.88 million.

Wall Street Analysts Forecast Growth

VSTM has been the subject of a number of research analyst reports. BTIG Research reissued a “buy” rating and issued a $18.00 price target on shares of Verastem in a research report on Thursday, July 2nd. HC Wainwright restated a “buy” rating and set a $18.00 price target on shares of Verastem in a report on Wednesday, June 24th. Guggenheim set a $12.00 price objective on Verastem in a report on Friday. Wall Street Zen raised Verastem from a “sell” rating to a “hold” rating in a research report on Saturday, July 25th. Finally, Alliance Global Partners reiterated a “buy” rating on shares of Verastem in a report on Friday, May 8th. Two equities research analysts have rated the stock with a Strong Buy rating, seven have given a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat.com, Verastem currently has an average rating of “Moderate Buy” and a consensus target price of $14.00.

Insider Buying and Selling at Verastem

In other Verastem news, CEO Dan Paterson sold 20,871 shares of the business’s stock in a transaction dated Monday, June 22nd. The stock was sold at an average price of $4.18, for a total value of $87,240.78. Following the completion of the sale, the chief executive officer owned 591,242 shares of the company’s stock, valued at $2,471,391.56. The trade was a 3.41% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 26,262 shares of company stock valued at $111,897 over the last ninety days. 1.94% of the stock is owned by insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently bought and sold shares of the company. AQR Capital Management LLC raised its holdings in Verastem by 78.2% in the 1st quarter. AQR Capital Management LLC now owns 62,603 shares of the biopharmaceutical company’s stock worth $377,000 after acquiring an additional 27,477 shares during the period. Goldman Sachs Group Inc. grew its position in shares of Verastem by 236.9% in the first quarter. Goldman Sachs Group Inc. now owns 756,402 shares of the biopharmaceutical company’s stock valued at $4,561,000 after purchasing an additional 531,873 shares during the last quarter. Geode Capital Management LLC increased its stake in shares of Verastem by 24.9% in the second quarter. Geode Capital Management LLC now owns 1,199,259 shares of the biopharmaceutical company’s stock worth $4,978,000 after purchasing an additional 238,995 shares during the period. Rhumbline Advisers lifted its position in shares of Verastem by 19.2% during the 2nd quarter. Rhumbline Advisers now owns 59,553 shares of the biopharmaceutical company’s stock worth $247,000 after purchasing an additional 9,594 shares during the last quarter. Finally, Invesco Ltd. boosted its stake in Verastem by 40.0% during the 2nd quarter. Invesco Ltd. now owns 52,063 shares of the biopharmaceutical company’s stock valued at $216,000 after purchasing an additional 14,879 shares during the period. 88.37% of the stock is currently owned by institutional investors and hedge funds.

Verastem Price Performance

The company has a current ratio of 3.04, a quick ratio of 3.00 and a debt-to-equity ratio of 0.89. The stock has a fifty day simple moving average of $4.81 and a 200-day simple moving average of $5.37. The stock has a market cap of $543.59 million, a price-to-earnings ratio of -2.29 and a beta of 0.26.

About Verastem

Verastem Oncology, Inc is a clinical-stage biopharmaceutical company focused on the discovery and development of small molecule therapies that target cancer stemness and resistance pathways. Established in 2010 and headquartered in Needham, Massachusetts, Verastem Oncology applies a precision-medicine approach to identify key signaling nodes responsible for tumor growth and relapse, with an emphasis on hematologic malignancies and solid tumors. The company’s research platform integrates insights into complex signaling networks to advance novel compounds from early discovery through clinical proof of concept.

The company’s lead marketed product is COPIKTRA (duvelisib), an oral inhibitor of PI3K-delta and PI3K-gamma, which received U.S.