First Berlin sets Lisata stock Buy rating on innovative therapies

On Tuesday, First Berlin Research initiated coverage on shares of Lisata Therapeutics, Inc. (NASDAQ: LSTA) with a Buy rating and a price target of $15.00. According to InvestingPro data, the stock currently trades at $3.71, with strong momentum showing returns of over 24% year-to-date.

The company's market capitalization stands at approximately $31 million. The firm's coverage begins on a positive note, highlighting the company's clinical-stage pharmaceutical focus on developing innovative therapies for advanced solid tumors and other serious diseases.

Lisata Therapeutics, which emerged from a merger with Cend Therapeutics in 2022, is currently advancing its lead drug candidate, certepetide. This peptide has a dual mode of action: it enhances the penetration of anti-cancer drugs into solid tumors and alters the tumor microenvironment.

By reducing immunosuppressive cell populations and increasing cytotoxic T cells, the drug candidate aims to boost the efficacy of existing chemo- and immunotherapies while also inhibiting metastasis progression.

The company's drug candidate is in clinical development across seven trials for various indications, including metastatic pancreatic ductal adenocarcinoma, cholangiocarcinoma, glioblastoma multiforme, and cancers of the pancreas, colon, and appendix.

While InvestingPro analysis indicates the company isn't currently profitable, with an EBITDA of -$23.3 million, it maintains a strong financial position with a current ratio of 8.03, indicating ample liquidity to fund its ongoing research. Lisata has also entered into a significant licensing agreement with Qilu Pharmaceuticals for the exclusive rights to certepetide in Greater China, which includes potential milestone payments totaling up to $221 million.

Qilu Pharmaceuticals has completed a phase 1b/2a study and is progressing with a phase 2 study in the lead indication of metastatic pancreatic ductal adenocarcinoma. Meanwhile, Lisata's own ASCEND phase 2b study in the same indication is anticipated to release results from its first cohort in January 2025, followed by the second cohort's results by the second or third quarter of the same year.

The year 2025 is expected to be pivotal for Lisata, with the firm forecasting that the outcomes of the ongoing trials for certepetide will likely serve as a significant catalyst for the company's share price. First Berlin's valuation model supports the $15.00 price target, and the firm underscores its confidence in Lisata with the Buy recommendation.

InvestingPro analysis suggests the stock is slightly undervalued at current levels, with analyst targets ranging from $13 to $15. Investors can access detailed financial health metrics, 8 additional ProTips, and comprehensive analysis through InvestingPro's detailed research report on Lisata Therapeutics.

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