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On Wednesday, Jefferies analyst Akash Tewari adjusted the price target for Zentalis Pharmaceuticals (NASDAQ:ZNTL), bringing it down to $2.50 from the previous figure of $6.00, while reiterating a Hold rating on the company’s stock. The stock, currently trading at $1.87, has experienced significant volatility, declining over 81% in the past year. According to InvestingPro analysis, the company appears undervalued based on its Fair Value assessment. The revision followed Zentalis’ recent updates concerning clinical data and the development and regulatory path for its drug candidate, azeno.
Zentalis provided information on the performance of azeno in Phase 1 studies, particularly its objective response rate (ORR) of approximately 30-35% in patients with Cyclin E positive persistent ovarian cancer (PROC) who have undergone extensive prior treatments. The dosage referenced for these outcomes was greater than 300mg.
Despite acknowledging the potential role of azeno in treating PROC, Jefferies remains cautious about Zentalis’ prospects. The firm’s position is influenced by the observation that the drug’s data does not appear to be clearly differentiated from other treatments currently in development for PROC, such as ACRV’s and alternative approaches like PLK1 sparing WEE1 inhibitors and non-biomarker selective topoisomerase ADC’s (antibody-drug conjugates). InvestingPro data shows the company maintains strong liquidity with a current ratio of 7.29 and holds more cash than debt on its balance sheet, providing some financial flexibility as it advances its clinical programs.
The analyst emphasized the firm’s neutral stance with a reiteration of the Hold rating, alongside the new price target of $2.50. This adjustment reflects Jefferies’ current assessment of Zentalis’ stock value based on the available clinical data and the competitive landscape within the PROC treatment market. Notably, broader analyst targets for ZNTL range from $4 to $20, suggesting varied opinions on the company’s potential. Discover more comprehensive financial insights and 8 additional key ProTips by subscribing to InvestingPro.
In other recent news, Zentalis Pharmaceuticals reported a reduction in their stock target to $10 by Oppenheimer, despite the promising data from their drug azenosertib. The drug has shown efficacy in treating ovarian cancer, particularly among patients with CCNE1-high subtypes of the disease. However, concerns have been raised regarding the duration of response and the estimated timeline for a pivotal trial.
In addition, Zentalis has announced the expansion of its leadership team, appointing Wendy Chang as Chief People Officer and Haibo Wang as Chief Business Officer. The company has also reported progress in its studies of azenosertib, a therapeutic targeting Cyclin E1+ platinum-resistant ovarian cancer, with an Objective Response Rate of approximately 35% in heavily-pretreated patients.
These developments follow the FDA’s decision to lift the partial clinical hold on Zentalis’s cancer drug, azeno, allowing the company to proceed with its planned clinical trials. The company is expected to reach several key milestones by the end of the year, including the release of various trial data. These are recent developments in Zentalis Pharmaceuticals’ progress.
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