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On Tuesday, Mizuho (NYSE:MFG) Securities adjusted its price target for Corvus Pharmaceuticals (NASDAQ:CRVS) stock, reducing it from $12.00 to $11.00 while maintaining an Outperform rating. Currently trading at $3.62, the stock sits well below analyst targets ranging from $11.00 to $24.00. According to InvestingPro data, analysts maintain a strong buy consensus with an average price target implying significant upside potential. The update follows a review of the company’s first-quarter financial model. Despite the lower price target, the firm’s stance on the stock remains positive, especially considering the recent clinical data and the risk/reward profile.
The analysis by Mizuho focused on Corvus Pharmaceuticals’ recent Phase 1 data for its leading asset, soquelitinib, which is being developed for the treatment of atopic dermatitis (AtD). Mizuho is optimistic about the drug’s profile based on this early-stage data and its progression into Phase 2 trials. The firm noted that quarterly financial results are currently less significant in their assessment than the clinical progress of soquelitinib. InvestingPro analysis shows the company maintains a strong financial position with a current ratio of 4.9x and minimal debt, providing runway for clinical development.
Mizuho highlighted several factors contributing to their positive outlook. They see soquelitinib as a potentially convenient, effective, and safer treatment option for AtD, especially when compared to currently approved JAK inhibitors. Furthermore, they believe the drug could serve as a platform for multiple therapeutic indications, which could be attractive to larger pharmaceutical companies.
The firm also expressed surprise at the stock’s recent performance, which has seen most of the gains from the initial Phase 1 AtD data announcement being lost. Based on these observations, Mizuho recommends investors to consider building or adding to their positions in Corvus Pharmaceuticals shares.
The endorsement from Mizuho comes at a time when Corvus Pharmaceuticals is poised to advance its clinical trials and possibly capture a share of the atopic dermatitis market with soquelitinib. While the stock has experienced a significant 56% decline over the past six months, it maintains a positive 59% return over the last year. The company’s journey through the clinical development stages will be closely watched by investors and analysts alike. For deeper insights into CRVS’s financial health and growth prospects, including additional ProTips and comprehensive analysis, visit InvestingPro.
In other recent news, Corvus Pharmaceuticals reported its Q1 2025 earnings, revealing an earnings per share (EPS) of -0.13, which narrowly missed the forecast of -0.12. Despite this minor miss, the company demonstrated a significant turnaround in net income, reporting $15.2 million, compared to a net loss of $5.7 million in the same period last year. This improvement was attributed to increased financial inflows from a warrant exercise. The company’s R&D expenses rose to $7.5 million from $4.1 million in Q1 2024, highlighting ongoing investment in its drug development pipeline. Corvus Pharmaceuticals also announced encouraging interim data from their Phase 1 trial of soquelitinib, showing a favorable safety and efficacy profile in treating atopic dermatitis. The promising results led to Oppenheimer analyst Jeff Jones maintaining an Outperform rating on the stock, raising the price target from $2 to $17. The company plans to commence a Phase 2 trial for soquelitinib later this year. These recent developments have sparked optimism among investors regarding Corvus Pharmaceuticals’ future prospects.
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