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On Tuesday, BMO Capital Markets reiterated its Outperform rating on Centessa Pharmaceuticals (NASDAQ:CNTA) with a steady price target of $35.00, representing significant upside from the current trading price of $15.85. With a market capitalization of $2.2 billion and analyst targets ranging from $26 to $36, the stock has shown strong momentum with a 44% gain over the past year. The firm’s analyst highlighted the company’s positive fourth quarter 2024 earnings per share (EPS) and directed attention towards the anticipated Phase II results for ORX750, a drug candidate for narcolepsy types 1 and 2, as well as idiopathic hypersomnia, expected in 2025.
The analyst expressed confidence in ORX750, citing its best-in-class data in healthy volunteers and the successful translation of similar data from other drugs to patient outcomes. Based on this, BMO Capital Markets estimates an 80% probability of success for the Phase II trials of ORX750, noting the drug’s potential to significantly improve mean wakefulness test durations without causing visual disturbances. According to InvestingPro analysis, while the company currently shows weak gross profit margins, its overall financial health score is rated as GOOD, suggesting strong potential for future growth.
Centessa Pharmaceuticals’ pipeline includes additional orexin agonist programs that could potentially broaden the company’s market reach. The analyst noted that these opportunities are not currently reflected in Centessa’s stock price but could represent a substantial growth area, as evidenced by doctor consultations and the off-label use of existing narcolepsy treatments. InvestingPro data reveals the company holds more cash than debt on its balance sheet, providing financial flexibility for its development programs. Get access to 6 additional InvestingPro Tips and a comprehensive Pro Research Report for deeper insights into Centessa’s financial position and growth prospects.
Centessa Pharmaceuticals is considered one of BMO Capital Markets’ top picks for 2025, with the firm’s analyst underscoring the potential for the company’s drug development programs to drive significant value for investors. The focus remains on the forthcoming clinical data and the potential for Centessa to capture a larger share of the sleep disorder treatment market. According to InvestingPro’s Fair Value analysis, the stock appears to be trading above its Fair Value, suggesting investors should carefully monitor upcoming catalysts and clinical trial results.
In other recent news, Centessa Pharmaceuticals has garnered attention with several key developments. TD Cowen has reiterated its Buy rating on the company’s stock, following a detailed presentation from Centessa’s leadership about their orexin receptor type 2 (OX2R) agonist, ORX750. This drug, currently in Phase 2 clinical trials, shows promise as a treatment for sleep disorders, with analysts optimistic about its potential impact. Additionally, Cowen research firm has initiated coverage on Centessa with a Buy rating, citing the transformative potential of ORX750 for conditions like narcolepsy and idiopathic hypersomnia.
In another strategic move, Centessa Pharmaceuticals has appointed Dr. Stephen Kanes as its new Chief Medical (TASE:BLWV) Officer. Dr. Kanes brings over 30 years of experience in neuroscience and drug development, which is expected to bolster Centessa’s efforts in advancing their OX2R agonist programs. His previous roles include CMO at Sage Therapeutics and CEO of EmbarkNeuro, adding valuable expertise to Centessa’s leadership team. The company is also advancing its proprietary LockBody technology platform, which aims to redefine cancer immunotherapy by targeting the tumor micro-environment while minimizing systemic toxicity. These recent developments highlight Centessa’s ongoing commitment to innovation in therapeutic treatments.
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