Clear Street sets Summit stock Buy rating, $33 target

On Thursday, Clear Street initiated coverage on Summit Therapeutics plc (NASDAQ:SMMT) with a Buy rating and a set price target of $33.00. According to InvestingPro data, analysts maintain a Strong Buy consensus with price targets ranging from $30.28 to $44.40, suggesting significant upside potential. Two analysts have recently revised their earnings expectations upward for the upcoming period. Summit Therapeutics is in the spotlight for its promising oncology treatment, ivonescimab, which has demonstrated superior results in multiple Phase 3 clinical studies compared to existing standard-of-care immunotherapies, including Keytruda, a top-selling global medicine for non-small cell lung cancer (NSCLC).

The company’s share price has seen a significant increase over the past year, with a remarkable 479% rise versus a 12% decline in the XBI, an index tracking the biotech sector. With a current market capitalization of $18.9 billion and a beta of -0.95, InvestingPro analysis shows the stock often moves counter to market trends. Despite this remarkable performance, analysts at Clear Street believe that Summit’s current enterprise value (EV) of $18.6 billion still presents an opportunity for growth. This optimism is based on the potential annual revenue exceeding $10 billion for ivonescimab as it nears pivotal study readouts and regulatory filings.

The late-stage NSCLC program is expected to produce global pivotal studies, starting with HARMONi data in mid-2025 for second-line treatment and beyond. Additionally, Summit Therapeutics is conducting trials for other tumor types, which are anticipated to provide proof-of-concept readouts. The company’s collaboration with Pfizer (NYSE:PFE) aims to expand ivonescimab’s market reach by pairing it with antibody drug conjugates, potentially moving beyond the success achieved by Keytruda in its current indications.

Clear Street’s analysis underscores the market’s recognition of Summit Therapeutics’ progress and the considerable upside potential for the stock as the company advances its lead drug candidate through the final stages of clinical development and toward commercialization. InvestingPro rates Summit’s overall financial health as ’Fair,’ with particularly strong price momentum scores. Subscribers can access 10+ additional ProTips and a comprehensive Pro Research Report, offering deeper insights into Summit’s valuation and growth prospects.

In other recent news, Summit Therapeutics has reported its first-quarter 2025 earnings, exceeding analysts’ expectations with an earnings per share (EPS) of -$0.07 compared to the forecasted -$0.09. Despite a loss of $62.9 million, the company’s financial health remains strong with a cash reserve of $361 million and no debt, as noted by Cantor Fitzgerald, which maintained an Overweight rating on the stock. Analysts at TD Cowen have upgraded Summit Therapeutics to a Buy rating due to the promising performance of its lead drug candidate, Ivonescimab. This drug has shown superior results in treating non-small cell lung cancer (NSCLC) compared to existing therapies, which could strengthen Summit’s position in the $50 billion checkpoint inhibitor market.

Summit Therapeutics is also advancing its clinical trials, with significant progress in developing Ivonescimab, which has already achieved approvals in China. The company is expecting to release top-line data from its HARMONY trial in mid-2025, which could further bolster its market position. Cantor Fitzgerald has projected that Summit’s financial resources should sustain operations through the end of the year. Investors are closely watching the upcoming HARMONY data release, as it could provide further insights into Ivonescimab’s potential impact on the NSCLC treatment landscape.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.