Arcutis Biotherapeutics, Inc. (ARQT) stock traded higher Thursday after Cantor Fitzgerald initiated coverage with an Overweight rating and a $48 price forecast, citing strong Zoryve sales growth and expansion opportunities in dermatology.
Cantor analyst Steve Seedhouse said Zoryve (roflumilast) leads the branded topical treatment market, providing a strong foundation for future growth.
Zoryve is a once-daily, nonsteroidal treatment available in cream and foam formulations. It is approved in the U.S. and Canada for plaque psoriasis, atopic dermatitis and seborrheic dermatitis.
The company reported second-quarter 2026 Zoryve net product sales of $129.9 million, up 59% year over year and 23% sequentially.
In June, the U.S. Food and Drug Administration approved Zoryve cream 0.3% for children as young as 2 with plaque psoriasis. This marked the company's seventh FDA approval since 2022.
Cantor Sees Multibillion-Dollar Sales Potential
Seedhouse said Arcutis' existing commercial business alone supports his bullish investment thesis.
He estimates Zoryve could generate peak sales of $2.6 billion to $3.5 billion by capturing 15% to 20% of the topical corticosteroid market.
Meanwhile, the FDA is reviewing Zoryve cream 0.05% for mild to moderate atopic dermatitis in infants ages 3 to 24 months. The agency has set a target decision date of Feb. 23, 2027.
Cantor views the infant indication as a significant growth opportunity because of the unmet need for effective nonsteroidal treatments.
The firm also sees potential upside from Zoryve's expansion into hidradenitis suppurativa and vitiligo, which could support longer-term revenue growth.
Zoryve's Competitive Edge
Seedhouse identified Incyte Corporation (INCY) and its Opzelura treatment as Zoryve's closest competitor by prescription volume.
However, Opzelura carries a boxed warning for atopic dermatitis. Its label also limits treatment to short-term, noncontinuous use in certain patients who have not responded adequately to other topical prescriptions or cannot use them.
Cantor believes these restrictions give Zoryve a meaningful competitive advantage and strengthen its growth prospects.
The firm initiated coverage with an Overweight rating and a $48 price forecast.
ARQT Price Action: Arcutis Biotherapeutics shares were up 8.77% at $28.72 at the time of publication on Thursday, according to market data.
