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On Thursday, B.Riley initiated coverage on ArriVent BioPharma (NASDAQ:AVBP) with a Buy rating and set a price target of $37.00, joining a growing consensus of bullish analysts who have set targets ranging from $36 to $45. The firm’s analyst, Kalpit Patel, highlighted the potential market expansion of ArriVent’s firmonertinib, a treatment for non-small cell lung cancer (NSCLC). Patel pointed out that the drug is designed to address NSCLC with EGFR exon 20 insertion (ex20ins) and PACC mutations, which represent approximately 4% of all NSCLC cases. According to InvestingPro data, the company maintains a strong financial position with more cash than debt on its balance sheet.
The analyst emphasized the potential for firmonertinib to become a superior treatment option within the roughly $700 million per year market for ex20ins NSCLC. He noted three key advantages of the treatment: its oral administration, ability to penetrate the brain, and improved tolerability compared to existing treatments. With a Phase III clinical trial expected to act as a catalyst within the year for ex20ins NSCLC, Patel suggested there could be a 50%-100% upside for the stock if the study replicates prior data. The company’s current market capitalization stands at approximately $667 million, with a healthy current ratio of 13.14, indicating strong short-term liquidity. InvestingPro subscribers can access additional financial health metrics and 8 more exclusive ProTips about AVBP.
Moreover, Patel mentioned that the current weakness in ArriVent’s stock seems to be driven by macroeconomic factors rather than the fundamentals of the company, suggesting that the current lower stock price could provide a good opportunity for investors to enter the market. This observation is supported by technical indicators from InvestingPro, which show the stock’s RSI suggesting oversold conditions, following a significant 26% decline year-to-date and nearly 10% drop in the past week alone.
The coverage comes at a time when ArriVent is preparing for significant clinical milestones, and the anticipation is for firmonertinib to potentially replicate its earlier positive data in the upcoming Phase III trial. If successful, the treatment could offer a new option for NSCLC patients with ex20ins and PACC mutations, addressing a small but important segment of the lung cancer market.
In conclusion, B.Riley’s initiation of coverage on ArriVent BioPharma with a Buy rating and a price target of $37.00 reflects a positive outlook for the company’s lead cancer drug, firmonertinib. The upcoming clinical trial results could prove to be a pivotal moment for the company and its stakeholders.
In other recent news, ArriVent BioPharma reported significant updates regarding its financial and operational status. The company has appointed PricewaterhouseCoopers LLP as its new auditor, replacing KPMG LLP, effective for the fiscal year ending December 31, 2025. This change was made without any disagreements over accounting practices, although ArriVent had previously identified and remediated material weaknesses in its financial reporting. Additionally, ArriVent BioPharma’s firmonertinib, an investigational treatment for non-small cell lung cancer, demonstrated promising efficacy and safety in recent clinical data, as highlighted by H.C. Wainwright, which maintained a Buy rating with a $39 price target. Oppenheimer also reaffirmed its Outperform rating and $39 price target, citing the company’s strong cash reserve of $266.5 million and its strategic initiatives, including progress in its Antibody-Drug Conjugate programs. These financial resources are projected to support ArriVent’s operations through 2026, according to Oppenheimer. The company plans to release further updates on its EGFR-PACC mutation data and the FURVENT study results in the coming months. Both H.C. Wainwright and Oppenheimer’s analysts expressed confidence in ArriVent BioPharma’s future potential.
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