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On Tuesday, H.C. Wainwright maintained a Buy rating and an $8.00 price target on Connect Biopharma Holdings Ltd (NASDAQ:CNTB) shares, representing significant upside potential from the current price of $0.55. According to InvestingPro analysis, CNTB appears undervalued based on its Fair Value metrics, despite the stock’s 75% decline over the past year. In a recent update, the company reported its full-year 2024 financial results and outlined its strategy to move forward with a Phase 2 trial of rademikibart, a treatment aimed at acute exacerbations linked to asthma or COPD, planned for the second quarter of 2025.
Connect Biopharma’s rademikibart is a monoclonal antibody that targets IL-4Rα, functioning in a manner similar to Dupixent. However, it has demonstrated improved target engagement. The company, which maintains a strong liquidity position with a current ratio of 12.04 and more cash than debt on its balance sheet, has pinpointed acute exacerbations as a market opportunity distinct from Dupixent, which has not been approved for such conditions nor is it being evaluated for them by Regeneron (NASDAQ:REGN). InvestingPro subscribers can access 13 additional key insights about CNTB’s financial health and market position.
Despite existing chronic treatments for asthma and COPD, many patients still experience acute exacerbations—sudden deteriorations of their condition—often resulting from respiratory infections or allergic reactions. In the U.S. alone, these exacerbations lead to roughly 1.6 million emergency department or urgent care visits each year. The current standard of care, typically bronchodilators or corticosteroids like prednisone, may not provide immediate relief and have a high rate of subsequent exacerbations.
Although rademikibart has not been tested in COPD patients, a subset of participants with COPD-like characteristics in a Phase 2b asthma trial showed a significant improvement in FEV1, a measure of lung function, when compared to a placebo. Notably, rademikibart displayed a rapid onset of action, with effects observed as soon as the first day of treatment.
Incorporating the potential of rademikibart in treating acute exacerbations into their financial model, H.C. Wainwright analysts have projected global peak sales reaching $2.3 billion by 2038, adjusting for a 25% probability. With analyst targets ranging from $6 to $8 and a consensus "Strong Buy" recommendation, the reiterated Buy rating and price target reflect the firm’s confidence in the drug’s market potential and Connect Biopharma’s growth prospects, despite the company’s current market capitalization of just $30.4 million.
In other recent news, Connect Biopharma Holdings Limited has been notified by Nasdaq regarding a potential delisting due to its stock price falling below the required minimum. The company’s American Depositary Shares have closed under the $1.00 mark for 30 consecutive business days, prompting this notification. Connect Biopharma now has until September 22, 2025, to comply with Nasdaq’s minimum bid price rule, which requires the stock to close at $1.00 or higher for at least ten consecutive business days. If the company fails to meet this requirement, it may qualify for an additional 180-day compliance period, provided certain conditions are met. The company continues to focus on its clinical-stage work, particularly with the anti-interleukin-4-receptor alpha antibody named rademikibart, which has shown positive results in Phase 2 trials for asthma. Despite the stock price challenges, Connect Biopharma remains committed to its research and development efforts. The company has not publicly addressed how the Nasdaq notice might impact its operations or development projects.
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