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On Friday, H.C. Wainwright analyst Andrew Fein reaffirmed a Buy rating on Foghorn Therapeutics (NASDAQ:FHTX) stock, with a steady price target of $13.00. Currently trading at $4.50 with a market capitalization of $250 million, the stock has attracted a strong consensus among analysts, with an average rating of "Strong Buy" and price targets ranging from $4 to $18. According to InvestingPro analysis, the company appears to be slightly undervalued based on its Fair Value assessment. Fein highlighted the upcoming presentation of results from Foghorn’s Phase 1a/b study of FHD-909 at the AACR 2025 Annual Meeting as a significant event for the company. Despite a year-over-year decline of 33% in Foghorn’s shares compared to the 13% dip in the XBI index, Fein believes the forthcoming data could be pivotal in validating the company’s broader strategy in targeting chromatin remodeling complexes (CRC). InvestingPro data reveals the company maintains a healthy current ratio of 3.73, indicating strong short-term financial stability despite the recent market performance challenges.
FHD-909, which is being assessed for its effectiveness in cancer treatment, is an allosteric inhibitor that selectively targets the ATPase function of BRM (SMARCA2) over BRG1 (SMARCA4). These proteins are key to the BAF chromatin remodeling complex, which is crucial for regulating chromatin dynamics. The upcoming results will also include preclinical combination data evaluating FHD-909 with pembrolizumab and KRAS inhibitors.
According to Fein, preclinical studies have shown that FHD-909 exhibits considerable anti-tumor activity against a range of BRG1-mutant lung cancers. Foghorn’s approach to screening within the full BAF complex is seen as a differentiator from other BRM-targeting therapies in development. Fein suggests that this method could lead to better structure-activity relationships (SAR) and ultimately, more effective therapeutic outcomes.
The analyst’s confidence in Foghorn is further bolstered by the company’s position at the forefront of an underexplored therapeutic area. Fein’s commentary underscores the potential of Foghorn’s work in the realm of chromatin remodeling in cancer treatment, considering it to have best-in-class potential. The maintained $13 price target reflects this optimism in the face of the company’s recent stock performance challenges. InvestingPro analysis shows the company holds more cash than debt on its balance sheet, though it’s currently experiencing rapid cash burn. Subscribers to InvestingPro can access 4 additional key insights about FHTX, along with comprehensive financial metrics and the detailed Pro Research Report, which provides deep-dive analysis of the company’s financial health and market position.
In other recent news, Foghorn Therapeutics has been in the spotlight following several key developments. B.Riley initiated coverage on the company with a Buy rating and a $10 price target, focusing on the potential of Foghorn’s lead asset, FHD-909, a SMARCA2 inhibitor, which is in a Phase I study. Despite a recent setback with the discontinuation of another product, FHD-286, analysts at B.Riley believe FHD-909 could offer significant clinical potential. Additionally, Foghorn Therapeutics received a compliance notice from Nasdaq due to a shortfall in its audit committee following a board member’s resignation. The company is expected to address this issue by its next annual shareholders’ meeting or by December 2025.
Further, H.C. Wainwright adjusted its price target for Foghorn shares to $13 from $20, maintaining a Buy rating, despite the halt in FHD-286 development. The firm remains optimistic about Foghorn’s financial health, citing a cash reserve of $267.4 million to support future projects. Jefferies also revised its price target to $14 from $18 but retained a Buy rating, noting the strategic reallocation of resources to other drug candidates, including FHD-909. The company’s management has indicated that its cash runway is expected to extend into 2027, providing stability for its ongoing and future initiatives.
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