Psychedelic Momentum Continues as Cybin Gets Positive Rating

It’s been a good last few days for the psychedelic medicine industry. It started last week when ATAI Life Sciences announced that it would finally be going public with a forthcoming Nasdaq IPO. Then just a couple of days later MindMed made its long-awaited debut on the Nasdaq.

These announcements were big news, for the individual companies and for the industry as a whole. These moves not only gave psychedelics positive media coverage with major publications but further legitimized the industry in the eyes of investors and Wall Street overlords.

Yesterday the good news continued as Roth Capital Partners initiated coverage of Cybin with a Buy rating and $10/share price target. Cybin (CYBN) is one of the top psychedelic firms with several drugs in their pipeline and a psilocybin compound for depression already in Phase 2 trials with the FDA. They also had the largest ever Canadian private funding for a psychedelic company, raising $45 million before their IPO on the NEO exchange.

Yet despite being a very solid company doing all the right things, Cybin is definitely in the second tier of psychedelic firms, in both reputation and market cap, behind heavyweights like Compass and MindMed. This is why this coverage by a reputable analyst is important news – Wall Street’s attention is now moving beyond the big names, showing that they believe in the wider industry’s potential.

Furthermore, the $10 target was over 500% of Cybin’s share price, an extremely encouraging sign that shows that early-stage psychedelics can withstand scrutiny from reputable analysts. Click here to see the full report.

Since the news, Cybin’s stock has been on the rise, up over 20% at the time of writing.

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Analyst coverage still lacking, but media might help change that

This positive rating by Roth is very good news, but it sticks out for being rare. Analysts have so far shied away from putting psychedelic predictions in writing, other than these few exceptions.

In January, Stifel GMP initiated coverage of Field Trip Health and Cybin, giving both a “speculative buy” rating with $8.50 and $5 price targets respectively. They also called these psychedelics a “possible disrupter to legacy treatments”.

And in March reputed investment firm Canaccord Genuity gave Cybin a Buy rating with an $8 price target, saying the firm has the potential to become a “solid psychedelic biopharma player”.

Yet this is where the major analyst’s coverage stops and where general media and financial coverage can help fill the gap. As mentioned above, the recent positive news and the continued acceptance by major stock exchanges is a huge win for the space, and will give Wall Street analysts more confidence in the sector.

With continued coverage like this week’s deep dive into psychedelics by the New York Times, hopefully, the industry will continue to gain momentum and legitimacy in both the media and the minds of the financial powers that be.