Editas Medicine stock target cut to $4 at Evercore ISI

On Tuesday, Evercore ISI updated its outlook on Editas Medicine (NASDAQ:EDIT), reducing the price target to $4 from the previous $5, while maintaining an Outperform rating on the stock. The firm’s analyst, Liisa Bayko, noted that Editas Medicine currently holds $221 million in cash reserves, which is projected to fund operations into the second quarter of 2027. According to InvestingPro data, while the company maintains a strong current ratio of 3.08 and holds more cash than debt, it’s quickly burning through its reserves, with an EBITDA of -$201 million in the last twelve months.

Bayko provided insights into the ongoing CRISPR/Cas9 patent dispute, stating that the Federal Circuit has remanded the case for further consideration. Despite this legal challenge, Editas Medicine’s agreements with Vertex Pharmaceuticals (NASDAQ:VRTX) and DHI Healthcare remain unaffected and in place. The company’s stock has shown resilience recently, with InvestingPro reporting a 16% return over the past week, though it remains down 73% over the last year.

The analyst also highlighted anticipation for Editas Medicine’s presentation at the American Society of Gene & Cell Therapy (ASGCT) this week. The company is expected to showcase preclinical data from its Sickle Cell Disease and Thalassemia (SCT/TDT) program. Additionally, Editas Medicine is set to reveal a second in vivo target, which is drawing interest from industry watchers and investors alike.

The reduction in the price target by Evercore ISI reflects a cautious but still optimistic stance on the biotechnology company’s prospects. The maintained Outperform rating suggests the analyst believes Editas Medicine’s stock will perform better than the overall market or sector in the future, despite the lowered price expectation.

Investors and stakeholders in the biotech sector will be watching closely as Editas Medicine reveals its latest research findings and progresses with its in vivo portfolio, which could have significant implications for the company’s valuation and future growth trajectory.

In other recent news, Editas Medicine, Inc. reported its fourth quarter 2024 financial results, which did not meet analyst expectations. The company posted a loss of $0.55 per share, exceeding the anticipated loss of $0.33 per share. Revenue was slightly above estimates at $30.6 million but showed a significant decline from the $60 million reported in the same quarter the previous year. This decrease was mainly due to lower recognition of upfront payments compared to the prior year, when a major licensing deal with Vertex Pharmaceuticals was executed. In terms of expenses, research and development costs decreased by 30% year-over-year to $48.6 million, while general and administrative expenses increased by 13% to $16.4 million. Additionally, Editas recorded $12.2 million in restructuring charges related to the discontinuation of its reni-cel program and a reduction in headcount by about 65%. The company ended 2024 with $269.9 million in cash and marketable securities, expecting this to fund operations into the second quarter of 2027. In other developments, Editas announced the resignation of CFO Erick Lucera, with Amy Parison set to assume the role. Parison, previously the Senior Vice President of Finance, will take over as CFO, bringing extensive experience from her roles at Rubius Therapeutics (OTC:RUBY) and Vertex Pharmaceuticals.

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