Absci stock rating initiated at Overweight by Morgan Stanley

Investing.com - Morgan Stanley (NYSE:MS) has initiated coverage on Absci Corp. (NASDAQ:ABSI) with an Overweight rating and a $7.00 price target. The company, currently valued at $343 million, has seen its stock demonstrate significant volatility with a beta of 2.07. According to InvestingPro data, five analysts have recently revised their earnings estimates upward for the upcoming period.

The coverage initiation comes as Absci prepares for a potential value inflection point with its lead asset, TL1A monoclonal antibody ABS-101, which is expected to deliver Phase 1 interim data from its first-in-human healthy volunteer study in the second half of 2025.

The Phase 1 study is evaluating approximately 40 participants with primary endpoints focused on safety and tolerability, while secondary endpoints include pharmacokinetics/pharmacodynamics and immunogenicity. Key objectives include demonstrating extended half-life supporting quarterly dosing, target engagement consistent with previously presented non-human primate data, and low immunogenicity.

Morgan Stanley notes that Absci aims to partner ABS-101 with a biopharma company, with management confirming active discussions with three companies that do not currently have TL1A assets in their pipelines. Any partnership would provide non-dilutive capital, potentially extending Absci’s cash runway beyond its current guidance of first half 2027. For deeper insights into Absci’s financial health and growth prospects, including 8 additional exclusive ProTips, visit InvestingPro to access the comprehensive Pro Research Report.

The firm acknowledges competitive pressure from later-stage TL1A assets from Merck (NSE:PROR), Roche, and Teva/Sanofi, as well as earlier-stage candidates from Spyre that share similar objectives of less frequent dosing and lower immunogenicity. With an overall Financial Health Score of 2.0 (Fair) from InvestingPro, investors should closely monitor the company’s progress in this competitive landscape.

In other recent news, Absci Corp reported its Q1 2025 earnings, revealing a revenue of $1.2 million. The company experienced a notable increase in research and development expenses, reflecting its strategic focus on advancing its product pipeline. Absci initiated its first-in-human clinical trial for ABS-101, marking its transition to a clinical-stage biotech company. The company also announced promising developments in its AI-driven drug discovery efforts, with potential large pharma partnerships on the horizon. Cash reserves increased to $134 million, extending the financial runway into 2027. Analysts from Guggenheim Securities and TD Cohen participated in the earnings call, reflecting interest in Absci’s innovative strategies. Absci’s focus on AI and strategic partnerships indicates a commitment to addressing challenging drug targets. The company’s ongoing efforts in its ABS-201 program for hair regrowth also highlight its broadening therapeutic focus.

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