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On Friday, Citizens JMP adjusted its price target on Relay Therapeutics (NASDAQ:RLAY) stock, lowering it to $12.00 from the previous target of $21.00. The adjustment comes as the stock has declined over 17% in the past week, though the firm maintained its Market Outperform rating on the shares. According to InvestingPro data, analysts remain generally bullish with a consensus recommendation of 1.54 (where 1 is Strong Buy).
The adjustment follows a shift in the dosage from phase 2 to phase 3 trials of Relay’s drug candidate. Citizens JMP’s analyst expressed optimism despite the initial surprise at the dosage change, citing additional pharmacokinetic and pharmacodynamic (PK/PD) data that supports the dose reduction and could potentially lead to increased tolerability for patients. InvestingPro analysis suggests the stock is currently trading below its Fair Value, with several additional insights available to subscribers.
Relay Therapeutics is aiming to replace the current treatment combination of capi + fulv in the second-line (2L) treatment post-CDK4/6 inhibition in metastatic breast cancer (mBC) patients. The ReDiscover phase 2 trial has provided compelling evidence for Relay’s drug, with significant progression-free survival (PFS) improvements compared to historical data from capi + fulv treatments. Specifically, RLY-2608 showed a 9.2-month PFS across all patients and an 11.4-month PFS in patients with kinase domain mutations.
The analyst highlighted that the ReDiscover phase 2 trial results not only suggest best-in-class efficacy in the 2L post-CDK4/6 mBC setting but also indicate that RLY-2608 has the potential to stand out in terms of safety. Relay Therapeutics’ continued development of RLY-2608 is closely watched as the company seeks to establish a new standard in cancer treatment. The company maintains a strong financial position with more cash than debt on its balance sheet, though InvestingPro data indicates it is currently burning through cash rapidly. Get access to the full financial health analysis and 10+ additional ProTips with an InvestingPro subscription.
In other recent news, Relay Therapeutics has been the subject of several analyst updates following significant developments. BofA Securities maintained its Buy rating on Relay Therapeutics, adjusting the price target to $20 from $21 after presenting updated Phase 1/2 data on RLY-2608 at the San Antonio Breast Cancer Symposium. This data provided a more mature analysis of median progression-free survival for the second-line breast cancer population, supporting the drug’s advancement to Phase 3 trials with a predicted peak sales potential surpassing $1 billion. Meanwhile, H.C. Wainwright adjusted its price target for Relay Therapeutics to $16 from $20, still recommending a Buy, after the company finalized a global licensing agreement with Elevar Therapeutics for the FGFR2 inhibitor, lirafugratinib. This agreement could yield up to $500 million in milestone payments and tiered royalties, as Elevar takes over the development and commercialization of the drug.
Additionally, Leerink Partners reduced its price target to $18 from $19 while maintaining an Outperform rating, noting the strategic nature of the licensing deal with Elevar Therapeutics. The agreement grants Elevar the responsibility for clinical development and global commercialization, with promising clinical data indicating a 37% overall response rate in FGFR2-altered tumors. These developments reflect Relay Therapeutics’ strategic moves to advance its drug candidates through partnerships and data-driven progress in clinical trials.
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