Arvinas stock target cut to $21 from $65 at Truist Securities

On Wednesday, Truist Securities adjusted its price target for Arvinas Inc. (NASDAQ:ARVN), a biopharmaceutical company, to $21.00, down from the previous target of $65.00. Despite the reduction, the firm maintained a Buy rating on the company's stock. Currently trading at $6.16, the stock has experienced significant pressure, falling over 83% in the past year and trading near its 52-week low of $6.00. According to InvestingPro analysis, the company appears undervalued based on its Fair Value metrics. The revised valuation comes after the release of the VERITAC-2 study results, which indicated that Arvinas' investigational therapy, vepdeg, extended progression-free survival (PFS) in patients with ESR1 mutant breast cancer but did not show the same effect in a broader patient population. InvestingPro data reveals that while the company maintains a strong liquidity position with a current ratio of 4.64 and minimal debt, it's currently burning through cash rapidly - one of 15+ key insights available to Pro subscribers.

The analysts at Truist Securities believe that Arvinas is likely to seek FDA approval for vepdeg, but anticipate that any approval may be limited to monotherapy for ESR1 mutant patients. This expectation has led to an adjustment in the forecast for vepdeg's commercial potential, with peak sales now estimated at $1 billion, as opposed to the consensus estimate of $1.8 billion.

Arvinas' pipeline includes additional prospects, notably from its collaboration with Pfizer (NYSE:PFE) on treatments for breast cancer expected to mature in three to four years. There are also opportunities from its partnership with Novartis (SIX:NOVN) (NVS) in prostate cancer, as well as a LRRK2 degrader for Parkinson's disease. Recently, Arvinas reported Phase 1 data from healthy volunteers for its LRRK2 degrader, demonstrating oral bioavailability, brain penetration, and a reduction in central and peripheral LRRK2 levels. These latter two pipeline products are not currently accounted for in the Street's valuations, according to the analysts.

In summary, Truist Securities has lowered its price target on Arvinas to $21 per share from $65 but continues to recommend a Buy rating on the stock, reflecting a positive outlook on the company's long-term potential despite the near-term adjustments. With analyst targets ranging from $10 to $110 and a consensus Buy rating of 1.64 (where 1 is Strong Buy), the stock presents an interesting opportunity for investors. For deeper insights into Arvinas's financial health, valuation, and growth prospects, access the comprehensive Pro Research Report available exclusively on InvestingPro.

In other recent news, Arvinas Inc. has been in the spotlight following the release of several significant clinical trial results and analyst evaluations. H.C. Wainwright maintained a Buy rating with an $81 price target, highlighting promising data from Arvinas's ARV-102 program, which showed no serious adverse events and demonstrated potential therapeutic activity in targeting LRRK2 for Parkinson's disease treatment. Meanwhile, the collaboration between Arvinas and Pfizer on the Phase 3 VERITAC-2 study revealed a statistically significant response in patients with ESR-1 mutant breast cancer, although it did not meet the primary endpoint in the overall population.

BMO Capital Markets responded to the VERITAC-2 data by drastically reducing their price target for Arvinas to $20 from $82, citing a limited opportunity for vepdeg in non-ESR1 mutant patients. Despite this, BMO maintained an Outperform rating, suggesting the market reaction may have been excessive. BTIG also kept a Buy rating, with a $69 price target, focusing on the potential of Arvinas's treatments for ESR1 mutant patients and its robust cash position.

Conversely, Citi reduced its target to $10 from $19 while maintaining a Neutral rating, pointing to the trial's inability to meet the primary endpoint and potential regulatory scrutiny. They noted the upside risk from Arvinas's early-stage pipeline, including treatments targeting LRRK2 and other mutations. Overall, these developments have drawn significant attention from investors, reflecting varied expectations for Arvinas's future in the pharmaceutical landscape.

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