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On Tuesday, Stifel analysts adjusted their expectations for Xenon Pharmaceuticals (NASDAQ:XENE), lowering the price target from $62.00 to $60.00, while still endorsing the stock with a Buy rating. According to InvestingPro data, analysts maintain a strong bullish consensus on XENE, with price targets ranging from $42 to $65, suggesting significant upside potential from current levels around $31. The revision follows Xenon’s first-quarter earnings report for 2025, which included an update on the company’s anticipated phase 3 clinical trial results for the drug azetukalner.
Xenon announced a minor delay in the completion of enrollment for its phase 3 trial of azetukalner, a potential treatment for focal onset seizures (FOS). The company now expects enrollment to be completed in the next few months, pushing the expected data readout to early 2026, as opposed to the second half of 2025 as previously projected. While the delay is not significant in the long term, it removes a key event from this year’s calendar. Despite potential near-term pressure, InvestingPro data shows Xenon maintains a strong financial position with a current ratio of 17.85 and minimal debt, providing ample runway for its clinical programs.
Despite the delay, Xenon also presented preliminary results from the Mt. Sinai-IST study of azetukalner in major depressive disorder (MDD). The data suggests a potential efficacy signal for the treatment of depression, although the presence of some variability in the data and placebo arm was acknowledged. The analyst believes that the overall positive outlook for azetukalner remains unchanged, maintaining confidence in the drug’s blockbuster potential and its high probability of success in treating epilepsy, with additional possibilities for treating other conditions.
Stifel’s stance reflects a belief in the inherent value of Xenon’s azetukalner, despite the short-term setback in the clinical trial timeline. The firm’s analysts underscore their view that the drug holds significant promise for the future, given its potential applications and the ongoing support from clinical data.
In other recent news, Xenon Pharmaceuticals reported its first-quarter earnings, revealing an adjusted earnings per share of -$0.83, which surpassed analyst expectations of -$0.91. The company’s revenue for the quarter was $7.5 million, significantly exceeding the consensus estimate of $1.25 million. Despite these financial results, Xenon announced a delay in the topline data from its Phase 3 X-TOLE2 study for azetukalner in focal onset seizures, now anticipated in early 2026. This delay marks a shift from previous guidance, although patient recruitment is expected to conclude in the coming months. The company is also making strides in its pipeline, with plans to initiate Phase 3 studies in major depressive disorder and bipolar depression by mid-year. Additionally, Xenon has commenced a Phase 1 study for XEN1120 and intends to file an IND for XEN1701 in the third quarter of 2025. The company ended the quarter with $691.1 million in cash and marketable securities, which it expects will sustain operations into 2027.
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