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On Wednesday, H.C. Wainwright adjusted its price target on Mural Oncology (NASDAQ:MURA) shares, reducing it significantly to $6.00 from the previous $18.00. Despite this change, the firm maintains a Buy rating on the stock. The adjustment comes as MURA shares have declined over 64% in the past week, now trading at $1.47, near its 52-week low. According to InvestingPro data, the stock appears undervalued at current levels, with analyst targets ranging from $6 to $18. The revision follows Mural Oncology’s announcement concerning the Phase 3 ATRISTRY-7 study, which did not demonstrate a statistically significant overall survival benefit for Nemvaleukin over the standard chemotherapy in patients with platinum-resistant ovarian cancer (PROC). Despite recent setbacks, InvestingPro analysis shows the company maintains a strong financial position with a current ratio of 5.84 and more cash than debt on its balance sheet.
The interim analysis results have shifted investor attention towards the potential impact on upcoming data for Nemvaleukin in both mucosal and cutaneous melanoma. While acknowledging the disappointment from the ATRISTRY-7 study outcome, H.C. Wainwright remains cautiously optimistic about Nemvaleukin’s prospects. The firm anticipates topline results from the Phase 2 trial in mucosal melanoma (ARTISTRY-6, Cohort 2) expected in the second quarter of 2025, along with updates from mono and combination therapy trials in cutaneous melanoma (ARTISTRY-6 Cohorts 3/4) in the second half of the year.
Mural Oncology’s focus is now on these upcoming trials, as the characteristics of melanoma differ significantly from PROC. Cutaneous melanoma, for instance, has a high tumor mutational burden due to UV-induced DNA damage, leading to strong immune recognition. Mucosal melanoma, while less immunogenic, still shows moderate tumor mutational burden and some immune infiltration. Both types of melanoma have historically responded better to immune checkpoint inhibitors compared to PROC, which is known for its low mutational burden and immunosuppressive environment.
H.C. Wainwright’s reiteration of the Buy rating despite the price target reduction reflects a belief in the potential of Nemvaleukin in treating melanoma types that are more responsive to immunotherapies. The firm’s stance is based on the scientific understanding that PROC and melanoma have distinct immunogenic profiles, which could influence the effectiveness of treatments like Nemvaleukin. With a market capitalization of just $25.33 million, investors seeking deeper insights can access additional analysis and 14 more key ProTips through InvestingPro, including detailed financial health metrics and valuation models.
In other recent news, Mural Oncology has announced the discontinuation of its phase 3 ARTISTRY-7 trial for the treatment of platinum-resistant ovarian cancer (PROC) after an interim analysis showed no significant improvement in overall survival. The trial evaluated nemvaleukin alfa in combination with pembrolizumab against standard chemotherapy, with results indicating a median overall survival of 10.1 months compared to 9.8 months for chemotherapy alone. Following these results, Raymond (NSE:RYMD) James downgraded Mural Oncology’s stock from ’Strong Buy’ to ’Outperform’ and reduced its price target from $18 to $6. Similarly, Morgan Stanley (NYSE:MS) adjusted its rating from "Overweight" to "Equal-weight," setting a new base case valuation range of $1 to $3, reflecting a cautious outlook on the company’s prospects.
Jones Trading also downgraded Mural Oncology’s stock from Buy to Hold, recommending investors wait for stabilization following the trial’s discontinuation. Despite these setbacks, Mural Oncology is focusing on the upcoming phase 2 ARTISTRY-6 trial results for mucosal melanoma, expected in the second quarter of 2025. The company maintains a solid financial position, with $144.4 million in cash, cash equivalents, and marketable securities reported at the end of the previous year. Mural Oncology continues to explore the potential of nemvaleukin in other studies, including less-frequent dosing in cutaneous melanoma, with data anticipated later in 2025. These developments underscore the company’s ongoing efforts to advance its clinical programs despite recent challenges.
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