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On Friday, Truist Securities adjusted its price target for AbCellera Biologics (NASDAQ:ABCL) shares, reducing it to $10.00 from the previous $28.00, while still endorsing the stock with a Buy rating. Trading at $2.02, the stock is near its 52-week low of $1.89, with a market capitalization of approximately $605 million. The adjustment follows AbCellera’s ongoing efforts to become a clinical-stage biotech company, with expectations to have two assets in clinical trials in the third quarter of the year. According to InvestingPro data, the company maintains a strong liquidity position with more cash than debt, though it is currently burning through its cash reserves.
The Truist Securities analyst highlighted AbCellera’s wholly owned asset, ABCL635, which is being developed for the treatment of hot flashes in postmenopausal women. Despite the early stage of development, the analyst expressed optimism about the program, citing several factors. These include the significant unmet need for vasomotor symptoms (VMS) treatments in postmenopausal women, the substantial market potential given that 30% of women experience VMS, and the target’s validation by already approved small molecule drugs. InvestingPro analysis suggests the stock is currently undervalued, with analysts maintaining an average price target significantly above current levels.
Moreover, the potential for ABCL635 to offer differentiated benefits in terms of safety and convenience was also emphasized. The new price target of $10.00 per share reflects a significant decrease from the previous target of $28.00, yet the firm’s outlook on AbCellera remains positive. The company’s financial health score from InvestingPro is currently rated as ’Weak’, with revenue declining 35% in the last twelve months. For deeper insights into AbCellera’s financial position and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
AbCellera Biologics focuses on discovering and developing antibody-based drugs. The company’s transition toward clinical trials represents a critical phase in its growth and the development of its product pipeline. The analyst’s comments suggest confidence in the company’s direction and the prospects of its ABCL635 program, particularly in addressing the needs of a market estimated at $2 billion.
The stock market will likely monitor AbCellera’s progress closely as it moves its assets into the clinic, with particular attention on the potential impact of ABCL635 in the treatment landscape for postmenopausal women experiencing hot flashes.
In other recent news, AbCellera Biologics Inc. reported a decline in its fourth-quarter 2024 earnings, with revenues reaching $5.1 million, falling short of the expected $7.58 million. For the full fiscal year, the company recorded $28.8 million in revenue, a decrease from $38.0 million in 2023, and reported a net loss of $0.55 per share, slightly wider than the previous year’s loss of $0.51 per share. Despite these financial challenges, AbCellera announced the initiation of a new development partnership and advancements of two partnered molecules into clinical trials.
In legal matters, AbCellera received a favorable ruling from the United States Court of Appeals for the Federal Circuit, which upheld the validity of its patent related to microfluidic devices, amidst ongoing litigation with Bruker (NASDAQ:BRKR) Cellular Analysis, Inc. Furthermore, the company revealed promising preclinical data for its prostate-specific membrane antigen (PSMA) x CD3 T-cell engagers, showing potential in treating metastatic castration-resistant prostate cancer. Benchmark analysts maintained a Hold rating on AbCellera’s stock, citing the company’s transition into a clinical-stage biotechnology firm.
Additionally, AbCellera announced the upcoming start of a Phase 1 clinical trial for its investigational drug, ABCL635, following Health Canada’s approval. This trial will focus on postmenopausal women experiencing moderate-to-severe vasomotor symptoms. Investors and analysts are closely monitoring these developments as AbCellera continues to navigate its transition and expand its pipeline of innovative treatments.
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