Rodman and Renshaw put 300p target on GW Pharma

Broker Rodman and Renshaw have initiated coverage of GW Pharma (GWP) with a Market Outperform rating and a 300p 12 month target against the current share price of 122p.

They estimate GW to be profitable in 2012 and estimate the company to earn £0.40/share in 2014. Applying a 20X multiple and a 30% annual discount rate they derive a 12-month target price of £3/share (300p).

This moved the share price up 10% yesterday to close at 127p. Profit takers have moved in today and Contrarian Investor UK took the opportunity to top slice the holding with major news not due for a couple weeks yet and the key date being the interim results on May 18th. The shares are currently down 8.5p or 7% to 121p.