Olema Pharmaceuticals stock target cut to $28 by H.C. Wainwright

On Wednesday, H.C. Wainwright adjusted its price target on Olema Pharmaceuticals (NASDAQ:OLMA) to $28.00, down from the previous target of $30.00, while reaffirming a Buy rating on the company’s stock. According to InvestingPro data, analyst targets for OLMA range from $20 to $30, with a strong consensus recommendation of 1.38 (Buy). The stock currently trades at $4.68, significantly below these targets. The revision follows Olema’s first-quarter financial results for 2025, which included an operating loss of $34.9 million and earnings per share (EPS) of ($0.36).

Olema reported a slight reduction in operating expenses in the first quarter of 2025 compared to the fourth quarter of 2024. H.C. Wainwright anticipates that the company’s operating expenses will continue to rise throughout 2025. This is attributed to the ongoing patient enrollment in the palazestrant Phase 3 study for second and third-line ER+/HER2- metastatic breast cancer (mBC) and the planned initiation of the OPERA-02 trial for first-line ER+/HER2- mBC. The firm projects Olema’s operating expenses for 2025 to be around $161.0 million, with an estimated EPS of ($1.67).

The company concluded the first quarter with $392.7 million in cash and equivalents. This financial position is a result of a successful equity raise completed in the fourth quarter of 2024. According to H.C. Wainwright’s analysis, the current cash reserves should be adequate to support Olema’s operations into the second half of 2027. InvestingPro analysis shows the company maintains a strong current ratio of 15.22, though it’s worth noting that the company is quickly burning through cash - one of several key insights available to Pro subscribers.

The adjustment in the price target to $28 from $30 by H.C. Wainwright is based on the higher number of shares outstanding following the equity raise. Despite the lowered price target, the firm maintains its positive outlook on Olema Pharmaceuticals, as reflected in the ongoing Buy rating. InvestingPro data indicates the company’s overall Financial Health score is FAIR, with particularly strong scores in cash flow management. The stock appears slightly undervalued based on InvestingPro’s Fair Value analysis, with 8 additional exclusive insights available to subscribers.

In other recent news, Olema Pharmaceuticals has reported significant developments in its clinical trials. The company disclosed promising results from its Phase 2 study of palazestrant in combination with ribociclib for treating ER+/HER2- metastatic breast cancer. The study indicated a median progression-free survival (PFS) of 13.8 months for all participants and 13.1 months for those previously treated with CDK4/6 inhibitors and endocrine therapy. This performance is potentially best-in-class compared to similar combination studies, which have shown PFS ranges of 8-9 months. H.C. Wainwright has maintained its Buy rating and a $30.00 price target on Olema Pharmaceuticals, reflecting confidence in the study’s findings and the drug’s efficacy. The analyst noted that 24 patients remain in the study, suggesting potential for further positive results. Olema Pharmaceuticals plans to initiate a Phase 3 trial in 2025, exploring the combination as a first-line treatment. The company anticipates presenting updated data at a medical conference later this year.

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