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Investing.com - Oppenheimer has raised its price target on SAB Biotherapeutics (NASDAQ:SABS) to $14.00 from $12.00 while maintaining an Outperform rating on the stock. The new target represents significant upside from the current price of $2.66, with InvestingPro data showing analyst targets ranging from $7 to $20.
The price target increase follows SAB Biotherapeutics’ announcement of a significant financing deal that includes participation from Sanofi (NASDAQ:SNY) and several life science institutional investors, providing $175 million in upfront cash with potential for an additional $284 million through warrants.
According to Oppenheimer, the financing extends SAB’s cash runway into mid-2028 and will enable the completion of SAB-142’s pivotal Phase 2b trial in Stage 3 type 1 diabetes (T1D). InvestingPro analysis indicates the company holds more cash than debt, though it has been rapidly burning through cash reserves. Get access to 8 more key financial insights with InvestingPro.
The research firm noted that Sanofi, which led diligence for this financing round, currently markets Tzield, the only drug indicated to delay Stage 3 onset in patients with Stage 2 T1D, which Sanofi acquired through its $3 billion purchase of Provention Bio (NASDAQ:PRVB) in 2023.
Oppenheimer highlighted that SAB Biotherapeutics now has capital to fund its business plan with an enterprise value of approximately $50 million, prompting the firm’s decision to raise its price target following model revisions. The company’s market capitalization currently stands at $25.55 million, with recent strong returns over both one and three months.
In other recent news, SAB Biotherapeutics has secured a $175 million private placement from strategic and institutional investors. This financing round saw participation from notable investors such as Sanofi, RA Capital Management, and Blackstone (NYSE:BX) Multi-Asset Investing, along with existing investors like Sessa Capital and the T1D Fund. The funds are earmarked to fully support SAB’s Phase 2b SAFEGUARD study, which is evaluating SAB-142 for delaying the progression of autoimmune type 1 diabetes. The company anticipates that this financing will extend its cash runway into the middle of 2028. Additionally, SAB will issue up to 1,000,000 shares of Series B nonvoting convertible preferred stock, convertible into up to 100,000,000 shares of common stock at a conversion price of $1.75 per share. The agreement also includes warrants that could potentially generate up to $284 million in additional gross proceeds. The private placement is expected to close by July 22, 2025, subject to customary conditions. Leerink Partners is leading the placement, with UBS Investment Bank, Chardan, and Oppenheimer & Co. as joint placement agents.
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