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On Thursday, Truist Securities adjusted its outlook for Sangamo BioSciences, reducing the price target on the company's shares to $5 from the previous $7, while still endorsing the stock with a Buy rating. The revision follows an assessment of the company's financials and pipeline developments. With the stock currently trading at $1.14, InvestingPro analysis indicates the stock is trading near its Fair Value, despite showing high price volatility over the past year.
The Truist Securities analyst provided insights into the rationale behind the new price target, noting significant updates to Sangamo's portfolio. The company has repatriated a Biologics License Application (BLA)-ready Phase 3 asset with promising data in Hemophilia A. Attention is now turned towards Sangamo's forthcoming strategy to solidify its financial footing, which includes securing a partnership for its Phase 3 Fabry disease asset and exploring additional capsid partnerships. According to InvestingPro data, the company's financial health score is currently rated as WEAK, with particularly concerning metrics around profitability and cash flow.
Sangamo's financial position was highlighted, with a cash and cash equivalents balance of approximately $39 million as of the third quarter of 2024. The company also received a $20 million upfront payment from a recent collaboration with Astellas Pharma in December. With a current market capitalization of $238.9 million and an EBITDA of -$117.03 million in the last twelve months, the future of Sangamo's cash reserves largely depends on securing a partnership for its Fabry disease treatment. Such a deal is anticipated to bring in a substantial upfront payment along with royalties, potentially alleviating concerns over the company's financial sustainability. For deeper insights into Sangamo's financial metrics and future prospects, investors can access the comprehensive Pro Research Report available on InvestingPro.
Truist Securities' stance remains positive, citing the potential financial boost that a partnership could provide. The analyst reaffirmed the Buy rating but acknowledged the need to adjust the price target to $5, reflecting the current assessment of Sangamo's assets and financial prospects. The firm awaits further details on the company's long-term cash position, which could be significantly influenced by the expected partnership announcements.
In other recent news, Sangamo BioSciences has encountered significant developments that impact its future trajectory. The biopharmaceutical company recently reclaimed development and commercialization rights for its gene therapy candidate, giroctocogene fitelparvovec, aimed at treating hemophilia A, following Pfizer (NYSE:PFE)'s decision to terminate their collaboration. This development came despite positive Phase 3 trial results. Analysts from H.C. Wainwright and Truist Securities have expressed confidence in Sangamo's future, with both firms maintaining a Buy rating on the company.
In addition to these changes, Sangamo has entered a $20 million licensing agreement with Astellas Pharma, potentially bringing the company up to $1.3 billion in milestone payments and tiered royalties on net sales of products developed through the collaboration. This agreement grants Astellas an exclusive worldwide license to Sangamo's STAC-BBB capsid technology for gene therapy applications in neurological diseases.
Wells Fargo (NYSE:WFC) has revised Sangamo's 2025 earnings per share estimate in light of these recent developments. Despite these changes, Sangamo's diverse pipeline, including a gene therapy program for Fabry disease and an innovative approach targeting the central nervous system, remains a key focus for the company. These are the recent developments in Sangamo BioSciences.
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