What the bad jobs report means for markets
On Thursday, Stifel analysts maintained a Buy rating on Zentalis Pharmaceuticals (NASDAQ:ZNTL) with a steady price target of $9.00. The stock, currently trading at $1.76, has seen significant volatility, with InvestingPro data showing a 88% decline over the past year. Despite recent challenges, analysts maintain an average price target suggesting substantial upside potential. The firm’s analyst, Bradley Canino, provided insights into the company’s recent progress, particularly regarding its azenosertib (WEE1i) phase 1b data in Cyclin E1+ PROC (platinum-resistant ovarian cancer) patients. Following a constructive dialogue with the FDA, Zentalis is set to initiate enrollment for dose confirmation in 30 patient cohorts. InvestingPro analysis indicates the company maintains strong liquidity with a current ratio of 7.29, providing financial flexibility for its clinical programs.
The enrollment will focus on two dosage regimens: 400mg once daily 5 days on, 2 days off, and 300mg with the same schedule, not exceeding three prior treatments. Updates on enrollment will be communicated at the outset and completion of patient enrollment, with limited data disclosures from the dosing cohorts to preserve the integrity of a potential New Drug Application (NDA) submission.
Zentalis aims to transition into a potentially pivotal phase 2 study, with data expected to be released by the end of 2026. Additionally, the company plans to commence a concurrent randomized confirmatory study. Stifel’s positive outlook is bolstered by Zentalis’s substantial cash reserves, totaling $371 million, along with clinical data that includes a recent favorable update on median duration of response (mDoR) this month. While InvestingPro data shows the company is quickly burning through cash, it maintains more cash than debt on its balance sheet, with a modest debt-to-equity ratio of 0.12. The comparative valuation for PROC treatments further supports the potential for growth in Zentalis’s stock value, though investors should note the company remains unprofitable with an EBITDA of -$208 million in the last twelve months.
In other recent news, Zentalis Pharmaceuticals has been the focus of several analyst evaluations following updates on its drug candidate, azenosertib. H.C. Wainwright reaffirmed a Buy rating with a price target of $10.00, emphasizing the promising results from the DENALI Phase 2 trial presented at the SGO 2025 conference. The trial highlighted azenosertib’s objective response rate (ORR) of 34.9% in patients with Cyclin E1+ tumors, suggesting potential improvements over traditional chemotherapy benchmarks.
Similarly, Oppenheimer adjusted its price target to $10.00, maintaining a Perform rating, and noted the drug’s efficacy in CCNE1-high ovarian cancer subtypes, although concerns about the duration of response and trial timelines were raised. Jefferies took a more cautious approach, reducing its price target to $2.50 and maintaining a Hold rating, citing competition and lack of differentiation in the PROC treatment landscape.
Zentalis has been actively developing azenosertib through various programs, including monotherapy and combination studies, and aims to conclude dose confirmation discussions with the FDA by 2025. The company is also exploring azenosertib’s potential for other Cyclin E1-driven cancers, with expectations of top-line data from the Denali Part 2 study by late 2026. Despite differing analyst opinions, the developments around azenosertib continue to draw investor attention, reflecting the drug’s potential impact on the treatment of platinum-resistant ovarian cancer.
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