Verastem (NASDAQ:VSTM) Stock Price Down 7% – Should You Sell?

Shares of Verastem, Inc. (NASDAQ:VSTM) dropped 7% on Tuesday. The stock traded as low as $7.66 and last traded at $7.6750. 1,573,566 shares traded hands during mid-day trading, a decline of 30% from the average session volume of 2,262,950 shares. The stock had previously closed at $8.25.

More Verastem News

Here are the key news stories impacting Verastem this week:

• Positive Sentiment: Promising VS-7375 data: Verastem reported a 50% confirmed overall response rate in second-line pancreatic ductal adenocarcinoma, including two complete responses in second-line-plus disease. The drug also showed anti-tumor activity in KRAS G12D-mutated lung and colorectal cancers, with management citing favorable safety and tolerability. VS-7375 clinical data
• Positive Sentiment: Higher analyst target: BTIG Research raised its price target from $18 to $24 and initiated or reiterated a “buy” rating, implying substantial potential upside and signaling increased confidence in VS-7375’s prospects.
• Positive Sentiment: Funding for late-stage development: The company priced a $250 million financing, giving Verastem additional capital as VS-7375 advances toward Phase III testing. Verastem financing announcement
• Neutral Sentiment: Leadership transition: Michael Bailey will become president and CEO on January 1, 2027, succeeding retiring CEO Daniel Paterson. The planned succession provides continuity, though investors may monitor execution under the new leadership. CEO transition announcement
• Negative Sentiment: Shareholder dilution and development risk: The offering involves more than 30.9 million common shares plus pre-funded warrants, potentially diluting existing holders. VS-7375 remains investigational, and the encouraging early-stage results must be confirmed in larger, later-stage trials; commentary also highlights competitive and timing risks in pancreatic cancer.

Analyst Upgrades and Downgrades

A number of equities analysts have weighed in on the company. HC Wainwright reissued a “buy” rating and issued a $18.00 target price on shares of Verastem in a research report on Monday, October 5th. BTIG Research lifted their price target on shares of Verastem from $18.00 to $24.00 and gave the stock a “buy” rating in a research note on Thursday. Wall Street Zen upgraded shares of Verastem from a “sell” rating to a “hold” rating in a research note on Sunday, September 27th. Royal Bank Of Canada reissued an “outperform” rating and set a $19.00 price objective (up from $14.00) on shares of Verastem in a report on Thursday. Finally, Cantor Fitzgerald restated an “overweight” rating on shares of Verastem in a research report on Monday, September 28th. Ten investment analysts have rated the stock with a Buy rating, one has given a Hold rating and one has given a Sell rating to the company’s stock. According to data from MarketBeat, Verastem has an average rating of “Moderate Buy” and a consensus price target of $16.50.

Verastem Stock Up 19.7%

The company’s 50-day moving average price is $7.54 and its 200 day moving average price is $5.91. The company has a debt-to-equity ratio of 1.48, a quick ratio of 2.22 and a current ratio of 2.25. The stock has a market cap of $835.60 million, a PE ratio of -3.46 and a beta of 0.39.

Verastem (NASDAQ:VSTM) last announced its earnings results on Thursday, August 6th. The biopharmaceutical company reported ($0.35) EPS for the quarter, beating analysts’ consensus estimates of ($0.43) by $0.08. Verastem had a negative net margin of 231.59% and a negative return on equity of 467.49%. The business had revenue of $40.08 million during the quarter, compared to analysts’ expectations of $22.88 million. As a group, analysts forecast that Verastem, Inc. will post -1.55 EPS for the current fiscal year.

Insider Activity

In other news, CEO Dan Paterson sold 44,121 shares of the company’s stock in a transaction on Thursday, October 1st. The stock was sold at an average price of $8.00, for a total value of $352,968.00. Following the completion of the sale, the chief executive officer directly owned 652,712 shares in the company, valued at $5,221,696. This represents a 6.33% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 48,044 shares of company stock worth $381,484. Insiders own 1.94% of the company’s stock.

Institutional Trading of Verastem

Several hedge funds have recently bought and sold shares of VSTM. Royal Bank of Canada grew its stake in shares of Verastem by 15.3% during the 1st quarter. Royal Bank of Canada now owns 110,729 shares of the biopharmaceutical company’s stock valued at $587,000 after acquiring an additional 14,683 shares during the period. Seven Fleet Capital Management LP bought a new stake in Verastem during the 4th quarter worth approximately $117,000. Bank of New York Mellon Corp raised its stake in Verastem by 31.8% during the 1st quarter. Bank of New York Mellon Corp now owns 161,707 shares of the biopharmaceutical company’s stock worth $857,000 after acquiring an additional 39,018 shares during the period. Hsbc Holdings PLC bought a new stake in Verastem during the 1st quarter worth approximately $210,000. Finally, ADAR1 Capital Management LLC purchased a new position in Verastem during the first quarter valued at approximately $377,000. Institutional investors own 88.37% of the company’s stock.

Verastem Company Profile

Verastem Oncology (NASDAQ:VSTM) is a biopharmaceutical company focused on developing and commercializing targeted therapies for cancers driven by abnormalities in the RAS/MAPK signaling pathway. The company’s research is aimed at addressing cancers with limited treatment options, including ovarian cancer and other solid tumors.

Verastem’s lead product, avutometinib, is a treatment targeting the RAF/MEK signaling pathway and is marketed in the United States under the brand name Avmapki for certain patients with recurrent low-grade serous ovarian cancer.