These are top 10 stocks traded on the Robinhood UK platform in July
On Friday, H.C. Wainwright maintained a Buy rating on FibroGen (NASDAQ:FGEN) with a steady price target of $10.00 following the company’s recent divestiture announcement. FibroGen revealed the sale of its China division to AstraZeneca (NASDAQ:AZN) on February 20, a strategic move expected to significantly enhance its financial stability and extend its cash runway. The announcement has contributed to the stock’s impressive 92.5% surge over the past six months, according to InvestingPro data.
The terms of the sale grant AstraZeneca all rights to the drug roxadustat in China. FibroGen will receive an enterprise value of $85 million plus the net cash held by FibroGen China at the time of closing, currently estimated at around $75 million. This aggregates to a total consideration of approximately $160 million. The deal is anticipated to be finalized by mid-2025.
FibroGen’s cash position as of December 2024 was reported at approximately $121 million. This transaction is predicted to prolong the company’s cash runway into 2027, a crucial development given that InvestingPro analysis indicates the company has been quickly burning through cash with a negative EBITDA of $114.8 million in the last twelve months. H.C. Wainwright analysts regard the sale as a savvy strategic decision, especially as it comes amidst challenging economic conditions in the sector. InvestingPro subscribers have access to 12 additional key insights about FibroGen’s financial health and market position.
The influx of capital and the narrowing of FibroGen’s focus will allow the company to allocate resources more effectively. It aims to concentrate on the development of roxadustat for low-risk Myelodysplastic Syndromes (LR-MDS) in the United States and advance its proprietary assets, such as FG-3246 and FG-3180.
FG-3246 is nearing a pivotal moment in its clinical trials, with the expectation of top-line results from the Phase 2 study of the drug in combination with enzalutamide for metastatic castration-resistant prostate cancer (mCRPC) in the first half of 2025. Additionally, a Phase 2 monotherapy dose escalation trial is set to begin in the second quarter of 2025, with an interim analysis targeted for mid-2026.
The announcement underscores FibroGen’s capacity to pursue its development plans and potentially advance FG-3246 into later-stage trials. It also opens the possibility of concurrently progressing the evaluation of roxadustat for treating LR-MDS. With a current market capitalization of $77 million and a price-to-book ratio of -0.32, InvestingPro’s comprehensive analysis suggests the stock is currently trading near its Fair Value. Investors can access detailed financial metrics, valuation models, and expert insights through InvestingPro’s extensive research reports, available for over 1,400 US stocks including FibroGen.
In other recent news, FibroGen, Inc. has announced the sale of its China subsidiary to AstraZeneca for approximately $160 million. This transaction, expected to close by mid-2025, will enhance FibroGen’s financial stability and allow the company to focus on its core development programs. The sale includes an enterprise value of $85 million and about $75 million in net cash held by FibroGen in China. Additionally, FibroGen has appointed David DeLucia as its new Chief Financial Officer, succeeding Juan Graham. DeLucia, previously the company’s Vice President, will lead the global finance organization, bringing nearly 15 years of financial leadership experience in the life sciences industry.
H.C. Wainwright has initiated coverage on FibroGen with a Buy rating, highlighting the potential of its antibody drug conjugate pipeline, particularly FG-3246. The firm set a price target of $10.00, noting the revenue-generating potential of roxadustat, which is already sold in China for anemia related to chronic kidney disease. FibroGen plans to discuss the development of roxadustat for lower-risk myelodysplastic syndrome with the FDA in the second quarter of 2025. This series of strategic developments positions FibroGen for potential growth and increased focus on its promising pipeline.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.