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Investing.com - Citi raised its price target on Krystal Biotech (NASDAQ:KRYS) to $176.00 from $155.00 on Wednesday, while maintaining a Neutral rating on the stock. According to InvestingPro data, KRYS maintains excellent financial health with a "GREAT" overall score and impressive gross profit margins of 93.2%. Analysis suggests the stock is currently undervalued relative to its Fair Value.
The price target increase follows Krystal Biotech’s announcement that the first patient has been dosed in the Phase 1/2 EMERALD-1 trial of KB801 for Neurotrophic Keratitis (NK), a rare eye disease.
Citi views KB801 as an "underappreciated asset" that may show differentiation from commercial Oxervate due to KB801’s improved dosing regimen and potentially superior NGF protein duration.
The investment bank noted that KB801’s similar utilization of HSV-1 (also used for Vyjuvek) and NK’s established approval pathway reduces risk for the program as it enters clinical trials.
Citi has incorporated the KB801 program into its financial model with a 25% probability of success in both the US and EU markets, with efficacy readouts expected approximately eight weeks after dosing.
In other recent news, Krystal Biotech has commenced its Phase 1/2 trial for KB801, an investigational eye drop gene therapy aimed at treating neurotrophic keratitis. The EMERALD-1 trial will involve up to 27 adults and primarily focuses on evaluating the safety and tolerability of the treatment. Meanwhile, Clear Street has initiated coverage on Krystal Biotech with a Buy rating and a $190 price target, citing potential upside from ongoing product launches and pipeline developments. H.C. Wainwright has maintained its Buy rating with a $240 price target, highlighting Krystal’s promising clinical results from its KB707 study in lung cancer patients. Krystal Biotech’s first-quarter financial results revealed earnings per share of $1.20 and revenue of $88.2 million, both falling short of estimates. Despite this, the company maintains a strong cash position of $765.3 million and attributes the revenue shortfall to seasonal insurance changes. Looking forward, Krystal Biotech plans to launch its flagship product, VYJUVEK, in Germany, France, and Japan throughout 2025. The company is also advancing its pipeline with several clinical catalysts expected by the end of the year.
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