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On Monday, H.C. Wainwright analysts assumed coverage of Boundless Bio Inc. (NASDAQ:BOLD), currently trading at $1.10 per share, assigning a Buy rating and setting a price target of $5.00 per share. The stock has declined significantly, falling nearly 88% over the past year. The analysts highlighted the potential of extrachromosomal DNA (ecDNA) as a breakthrough in addressing drug-resistant tumors, particularly with the development of the company’s CHK1 inhibitor, BBI-355.
Boundless Bio is a clinical-stage biotechnology company focused on creating novel oncology therapeutics targeting ecDNA. These are circular genes separate from chromosomal DNA, which can lead to increased transcription and oncogene amplification. The company is prioritizing its efforts on developing BBI-355, an oral, selective CHK1 inhibitor, and BBI-825, an oral, selective ribonucleotide reductase (RNR) inhibitor, as a combined treatment approach for certain tumor types.
The analysts noted that CHK1 plays a crucial role in regulating the DNA damage response pathway and is particularly sensitive to oncogene-amplified cancers. Meanwhile, RNR is essential for DNA synthesis and represents a unique dependency for cancer cells.
According to H.C. Wainwright, the market has yet to recognize the value of Boundless Bio’s program. Despite holding approximately $138 million in cash and cash equivalents, the company has a market capitalization of only around $25 million. The analysts believe that with a cash runway extending into 2027, there is reduced risk and significant upside potential for the stock at its current levels. InvestingPro analysis indicates the stock is currently undervalued, with a strong current ratio of 22.15 and more cash than debt on its balance sheet. Subscribers to InvestingPro can access 14 additional investment tips and comprehensive financial metrics to better evaluate this opportunity.
In other recent news, Boundless Bio Inc. has experienced several notable developments. Leerink Partners downgraded the company’s stock rating from Outperform to Market Perform, significantly reducing the price target from $15.00 to $3.00. This downgrade follows a reassessment of Boundless Bio’s lead CHK1 inhibitor program, which has faced setbacks, including a delay in validating the ecDNA hypothesis with the ECHO diagnostic tool. Furthermore, Boundless Bio has announced a potential $14.5 million stock sale through an agreement with Jefferies LLC. This deal allows for "at the market offerings" of common stock, although the timing and volume of sales remain uncertain. The agreement is pending SEC approval of the registration statement filed by the company. Boundless Bio has also agreed to indemnify Jefferies against certain liabilities related to the sale. These recent developments highlight the company’s ongoing efforts to navigate challenges in its oncology programs and financial strategies.
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