Duncan-Williams Maintains Hold Rating on Cumberland Pharmaceuticals

Duncan-Williams is maintaining its Hold rating on shares of Cumberland Pharmaceuticals, Inc. (NASDAQ: CPIX).

“Our valuation is now primarily based on a DCF analysis,” Duncan-Williams writes. “We use a WACC of 14% with a terminal growth rate of 0% to arrive at a hypothetical estimate of $6.00 (after adjusting our discount period).

“If we were to compare Cumberland with other specialty pharmaceutical companies we would apply a multiple of 12x (in line with the group) to 2012 consensus EPS of $0.36 to derive a hypothetical price target of $4.30.”

Cumberland Pharmaceuticals closed Tuesday at $5.72.