Most investors see analysts issue Buy and Outperform ratings with 8% to 20% upside for traditional Dow Jones Industrial Average or S&P 500 stocks. Still, other analyst calls reach much farther, with 30%, 50% or even with 100% implied upside to the actual price targets. One such analyst call with a Buy rating was calling for Aldeyra Therapeutics Inc. (NASDAQ: ALDX) to double.

Corey Davis and Lidia Liu of Canaccord Genuity started Aldeyra Therapeutics with a Buy rating and they issued a $16.00 price target. This is up just over 100% from the $7.76 close on Tuesday, and it is up just under 100% from the post-open trading price of $8.25 Wednesday morning.

Given a 52-week trading range of $3.00 to $13.50, very thin trading volume of 31,000 shares on an average day, and a market cap of not even $80 million based on the prior close, 24/7 Wall St. would warn readers that Aldeyra Therapeutics is a very thinly traded illiquid stock. It will come with a much wider bid/ask spread than most stocks. So, now interested investors can consider themselves properly warned.

What is it that Canaccord Genuity’s analysts see here for such an aggressive price target? The firm believes the company corrects errors in aldehyde metabolism. The report said:

Aldeyra is developing an unique aldehyde-trapping molecule, NS2, to treat two orphan indications with significant unmet need: Sjögren-Larsson Syndrome (SLS) and noninfectious anterior uveitis (AU). Since both diseases are associated with disruptions in aldehyde metabolism, decreasing the aldehyde load should mitigate the underlying inflammation. NS2 is currently in Ph2 for SLS and AU, with results anticipated at the end of 2015; since no human efficacy data is available to date, readout of the these trials would be huge catalysts for the stock.

The key here is the warning that no human efficacy data is available to date, followed by the results not being anticipated until the end of 2015.

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Other considerations were seen as follows:

• SLS affects about 1,000 patients in the US and is caused by mutations in fatty aldehyde dehydrogenase (FALDH).
• In models that are representative of ocular inflammation and SLS, NS2 was shown to protect the moisture barrier of the skin and quench elevated levels of toxic aldehyde. In a Ph1 study of 48 healthy volunteers, NS2 eye drop was well tolerated over a 7-day treatment period and no plasma exposure was detected.

The orphan drug target here was shown to bring potential M&A hopes as well. Davis and Liu said:

On May 6th, Alexion acquired Synageva for $8.4 billion. The key asset of the deal is Kanuma, a drug for lysosomal acid lipase deficiency, which is estimated to affect ~3,000 patients. In comparison, SLS alone is a ~1,000 patient market, so one might argue that Aldeyra could be the next Synageva. While it’s obviously too early to think about M&A at this point, if N2S shows efficacy, we think there will be interested parties.

Canaccord’s $16 price target was based on a 25-times multiple based off of potential 2022 earnings per share of $3.55, which was then discounted back for 6.5 years at 30%.

Canaccord Genuity ended noting that the risks to this implied upside include failure to produce positive results from its two ongoing Phase 2 clinical studies and/or failure to gain FDA approval.

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