Clarus Therapeutics Holdings, Inc. (CRXT) in Northbrook, Ill., is a pharmaceutical company that is focused on developing and commercializing oral testosterone replacement therapy in the United States. It offers JATENZO, a soft gel oral formulation of testosterone undecanoate for treating hypogonadal men.
Pharmaceutical companies have enjoyed investors’ attention since the onset of the COVID-19 pandemic. The pandemic highlighted the importance of pharma companies as they developed lifesaving vaccines and therapies to fight the deadly virus. Pharma companies continue to adopt emerging technologies to discover drugs needed to treat chronic and emerging diseases. According to the The Global Spending and Usage of Medicines 2022: Outlook to 2026 report, global spending on medicines is expected to grow at a CAGR of between 3% - 6% through 2026 to reach about $1.8 trillion by 2026. However, CRXT has so far failed to capitalize on the industry’s growth.
The stock has declined 52.2% in price year-to-date and 88.4% over the past year to close the last trading session at $1.16. It is currently trading 96.2% below its 52-week high of $31.24, which it hit on August 26, 2021.
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Here is what could influence CRXT’s performance in the upcoming months:
Disappointing Recent Financials
CRXT’s total operating expenses increased 3.1% year-over-year to $10.54 million for the fourth quarter, ended Dec. 31, 2021. In addition, its general and administrative expenses increased 18.2% year-over-year to $4.34 million. The company’s net loss came in at $4.30 million, compared to $278,000 in net income in the year-ago period. Also, its loss per share was $0.19, compared to a $3.01 loss per share in the year-ago period.
Favorable Analyst Estimates
Analysts expect CRXT’s revenues to grow 86.3% in its fiscal year 2022 and 81.9% in its fiscal 2023. Its EPS for fiscal 2022 and 2023 is expected to grow 68.5% and 29.4%, respectively, year-over-year.
POWR Ratings Reflect Uncertainty
CRXT has an overall C rating, which equates to a Neutral in our POWR Ratings system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.
Our proprietary rating system also evaluates each stock based on eight distinct categories. CRXT has a D grade for Momentum. The stock is currently trading below its 100-day and 200-day moving averages of $2.23 and $4.97, respectively, justifying the Momentum grade.
Among the 425 stocks in the F-rated Medical – Pharmaceuticals industry, CRXT is ranked #59.
Beyond what I have stated above, view CRXT’s ratings for Growth, Value, Stability, Sentiment, and Quality, here.
Bottom Line
CRXT is currently trading below its 100-day and 200-day moving averages, indicating a downtrend. However, analysts expect its financials to improve this year and beyond despite its weak performance so far. So, it could be wise to wait for a better entry point in the stock.
How Does Clarus Therapeutics Holdings, Inc. (CRXT) Stack Up Against its Peers?
CRXT has an overall POWR Rating of C, equating to a Neutral rating. Therefore, one might want to consider investing in other Medical – Pharmaceuticals stocks with an A (Strong Buy) or B (Buy) rating, such as Novartis AG (NVS), Merck & Co., Inc. (MRK), and Zoetis Inc. (ZTS).
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REVISED: 2022 Stock Market Outlook
CRXT shares were trading at $1.22 per share on Friday afternoon, up $0.06 (+5.36%). Year-to-date, CRXT has declined -49.79%, versus a -5.19% rise in the benchmark S&P 500 index during the same period.
About the Author: Dipanjan Banchur
Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.
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