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On Friday, Leerink Partners adjusted their financial outlook for Arcturus Therapeutics (NASDAQ:ARCT), reducing the biotechnology company’s price target from $70.00 to $65.00. Despite this change, the firm maintained an Outperform rating on the stock. Currently trading at $15.97, the stock has shown significant volatility, with a 52-week range of $14.30 to $45.00. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculation. The adjustment came in response to Arcturus’s announcement of its full-year 2024 earnings and updates on its product pipeline.
Arcturus disclosed a gross profit share of $28 million for Kostaive in Japan for the fourth quarter of 2024. This figure is after accounting for the distribution partnership with Meiji and a profit split agreement with CSL (OTC:CSLLY). The earnings from Kostaive are designated to cover 40% of the total development costs owed to CSL. InvestingPro data shows the company maintains strong liquidity with a current ratio of 4.76, and notably holds more cash than debt on its balance sheet, providing financial flexibility for its development programs. Although the reimbursement process and the initiation of revenue recognition for Kostaive are expected to take a few years, Arcturus achieved milestones related to Kostaive’s approval in the European Union in the first quarter of 2025. Further milestones are anticipated in 2026, connected to a Biologics License Application (BLA) filing in the United States, which is slated for later this year.
In addition to the vaccine pipeline, Arcturus is making steady progress in its rare disease portfolio. The company is set to present Phase 2 data for its cystic fibrosis (CF) and ornithine transcarbamylase deficiency (OTC) programs by the end of the second quarter of 2025. This ongoing development remains a critical part of Arcturus’s strategy.
Leerink Partners has updated its financial model for Arcturus to reflect the latest quarterly disclosures. The revised model postpones the expected contribution from Kostaive’s profit share to the company’s revenue line to 2026. This conservative approach takes into account the anticipated development cost reimbursements in 2025. Despite the reduction in the price target, Leerink’s reiteration of the Outperform rating indicates a continued positive outlook on Arcturus’s stock performance. For deeper insights into Arcturus’s financial health and growth potential, including additional ProTips and comprehensive valuation metrics, investors can access the full research report on InvestingPro.
In other recent news, Arcturus Therapeutics Holdings Inc. reported disappointing financial results for the fourth quarter of 2024, with earnings per share (EPS) at -$1.11, significantly missing analyst forecasts of -$0.19. The company’s revenue also fell short of expectations, coming in at $22.8 million compared to the anticipated $63.22 million. Despite these setbacks, Arcturus maintains a strong cash position with $293.9 million in cash and equivalents. The company has received European Commission approval for CoStave, a self-amplifying mRNA COVID-19 vaccine, marking a significant milestone in its vaccine development efforts. Arcturus has provided revised guidance for 2025, projecting EPS losses of -$0.3 for Q1 and -$0.09 for Q2, with anticipated revenues of $62.5 million and $70.3 million, respectively. The company continues to focus on expanding its therapeutic and vaccine pipelines, with interim data for key programs expected in 2025. Analyst firms such as Leerink and Piper Sandler have shown interest in the company’s strategies and future data readouts. Arcturus remains focused on its innovative self-amplifying mRNA platform, which it considers a competitive advantage in the biotechnology sector.
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