Barclays initiates Xencor stock with Underweight rating on pipeline concerns

Investing.com - Barclays initiated coverage on Xencor, Inc. (NASDAQ:XNCR) with an Underweight rating and a $6.00 price target on Wednesday. According to InvestingPro data, this target represents the lowest among analysts, with the highest target standing at $40.00.

The research firm cited concerns about Xencor’s internal pipeline, which it says "has disappointed and has not provided the valuation upside" despite the company’s innovative antibody technology platform. InvestingPro analysis shows the company is quickly burning through cash, with a negative EBITDA of $131 million in the last twelve months.

Barclays acknowledged that Xencor has developed royalty-yielding commercial antibodies, including AstraZeneca’s Ultomiris and Incyte’s Monjuvi/Minjuvi, which have provided revenue streams and helped the company maintain a healthy balance sheet. Indeed, InvestingPro data confirms the company holds more cash than debt and maintains strong liquidity with a current ratio of 5.34.

The firm noted that Xencor plans to report initial dose-escalation data for XmAb819 (ENPP3 x CD3), its most advanced cancer program, from a Phase 1 study in clear cell renal cell carcinoma at a medical conference in the fourth quarter of 2025.

Barclays believes this upcoming data will be early-stage and will likely have only "a modest impact on shares," contributing to its cautious stance on the stock.

In other recent news, Xencor has seen a change in its stock price target as RBC Capital lowered it from $32 to $15. Despite this significant reduction, RBC Capital maintains an Outperform rating on the stock, suggesting that certain aspects of Xencor’s business remain undervalued. The adjustment in the price target was attributed to model updates and conversations with Xencor’s management. In another development, Xencor has appointed Raymond J. Deshaies, Ph.D., to its board of directors. Dr. Deshaies brings extensive experience from his previous role as senior vice president of global research at Amgen Inc. His contributions at Amgen included the nomination of over 50 clinical candidates and advancements in drug discovery technologies. These recent developments reflect ongoing strategic adjustments and leadership enhancements at Xencor.

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