Tonix Pharmaceuticals stock halted ahead of FDA approval news
On Friday, Morgan Stanley (NYSE:MS) analysts began coverage of Denali Therapeutics Inc. (NASDAQ:DNLI) with an Overweight rating and set a price target of $33.00, representing significant upside from the current price of $16.27. According to InvestingPro data, analyst targets for the stock range from $24 to $80, with the company maintaining a strong financial health score despite recent market challenges.
Denali’s ETV technology is designed to enhance the delivery of therapeutics across the blood-brain barrier, a significant challenge in treating neurological disorders. Morgan Stanley’s analysts noted the potential for expansion of the ETV platform to other therapies that are currently treated via enzyme replacement therapy (ERT), suggesting that the risks associated with this expansion are mitigated. InvestingPro analysis shows the company holds more cash than debt on its balance sheet, with a healthy current ratio of 8.46, providing substantial runway for its development programs.
The analysts also addressed concerns about the current stock price, which they believe may be undervaluing Denali’s DNL126 program for Sanfilippo syndrome, due to the anticipated earlier launch of a competing therapy, UX111, by RARE. Despite this competitive pressure and a 20% decline in share price over the past year, Morgan Stanley’s team sees Denali as a primary beneficiary in a changing market, particularly following the FDA’s recognition of heparan sulfate (HS) as a surrogate endpoint, which could streamline the development and approval process for treatments targeting HS-related disorders. For deeper insights into Denali’s valuation and 8 additional exclusive ProTips, visit InvestingPro.
Denali’s focus on leveraging its ETV platform to create innovative treatments for neurodegenerative diseases and other neurological disorders has positioned it as a company to watch in the biotechnology sector.
The Overweight rating indicates that Morgan Stanley’s analysts expect Denali’s stock performance to outpace the average return of the stocks the firm covers over the next 12 to 18 months. The new price target of $33.00 suggests a positive outlook for the stock’s future value, based on the firm’s analysis.
In other recent news, Denali Therapeutics Inc. has been making significant strides in its clinical and regulatory efforts. The company is preparing to submit a Biologics License Application (BLA) for tividenofusp alfa, also known as DNL310, early this year, seeking accelerated approval. The U.S. Food and Drug Administration (FDA) recently granted Breakthrough Therapy Designation to DNL310 for the treatment of Hunter syndrome, highlighting its potential to improve treatment over existing options. Analysts from Stifel and Deutsche Bank (ETR:DBKGn) have maintained a Buy rating on Denali, with price targets set at $37.00 and $31.00, respectively, reflecting confidence in the company’s pipeline and strategic direction.
H.C. Wainwright analyst Andrew Fein adjusted the price target for Denali to $80.00 from $87.00, while maintaining a Buy rating, due to reassessed operational expenses and market penetration projections. Denali’s DNL126 program, which is part of the FDA’s Support for Clinical Trials Advancing Rare Disease Therapeutics (START) program, shows promise for expedited development and potential accelerated approval. The company’s efforts are also focused on expanding trials to gather sufficient data for regulatory submissions, aiming for a U.S. commercial launch of DNL310 by late 2025 or early 2026. Analysts have noted the potential impact of Denali’s Transport Vehicle (TV) platform, which targets rare diseases, on the company’s stock value and future growth prospects.
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