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On Tuesday, Citizens JMP analysts raised the price target for Enanta Pharmaceuticals stock (NASDAQ: NASDAQ:ENTA) to $24 from $23, maintaining a Market Outperform rating. Currently trading at $6.29, the stock has shown strong momentum with an 8% gain over the past week. The analysts highlighted the company’s ongoing focus on immunology as a key factor in their decision. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value estimate.
Enanta Pharmaceuticals is set to report Phase 2 results for its oral RSV therapeutic candidate, zelicapavir, in the third quarter. However, the company has indicated that further development of this candidate, along with the RSV-polymerase inhibitor EDP-323, will require a partnership. While the company maintains a strong liquidity position with a current ratio of 5.29, InvestingPro data indicates the company is quickly burning through cash. The analysts noted that despite the availability of antivirals for HBV (EDP-514) and SARS-CoV-2 (EDP-235) for partnering, there is concern that the RSV candidate may not progress without a partner.
In their analysis, the Citizens JMP team has removed RSV from their valuation and incorporated models for Enanta’s lead immunology candidates. These include EPS-1421, targeting chronic spontaneous urticaria (CSU) with wild-type c-Kit, and a STAT6 program for atopic dermatitis (AD). While these programs have not yet entered clinical trials, the analysts expect the small molecule candidates to be highly potent and selective, with favorable oral pharmacokinetic properties.
The updated price target reflects these model changes and the adjustment of cash used in the valuation to the fiscal year-end 2025. The analysts reiterated their confidence in Enanta’s strategy and potential for growth in the immunology sector.
In other recent news, Enanta Pharmaceuticals reported its second-quarter fiscal year 2025 results, revealing a significant cash reserve of $193 million. The company anticipates that its financial resources will support operations through fiscal year 2028. Additionally, Enanta received a $33.8 million tax refund in April, contributing to its financial stability. JMP analysts have responded by raising their price target for Enanta to $23, up from $21, while maintaining a Market Outperform rating. This adjustment reflects the company’s recent financial results and the expected outcomes of its mid-stage RSV trials. Enanta is also progressing with its Phase 2 trial, RSVHR, involving approximately 180 adults at higher risk for respiratory syncytial virus, with results expected in the third quarter of 2025. The company continues to advance its immunology pipeline, with promising developments in its oral KIT and STAT6 inhibitor candidates. Enanta plans to announce a third immunology program within the year, demonstrating its ongoing commitment to expanding its drug development efforts.
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