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On Thursday, Truist Securities adjusted its outlook on Tourmaline Bio (NASDAQ:TRML), reducing the company's price target to $63 from the previous $74, while reaffirming a Buy rating on the stock. The adjustment comes as the firm updates its financial model to include projections for Pacibekitug, a promising treatment for ASCVD (atherosclerotic cardiovascular disease). Currently trading at $12.48, the stock sits near its 52-week low of $11.63, with analyst targets ranging from $43 to $74. InvestingPro analysis suggests the stock may be currently undervalued based on its Fair Value model.
Analysts at Truist Securities have expressed a positive stance on the potential for Pacibekitug, estimating worldwide end-user sales to reach $2.9 billion. This figure, they suggest, might be on the conservative side. The firm's analysts believe that the current market price offers an appealing opportunity for investors to buy into Tourmaline Bio, especially considering the stock is trading at levels close to its cash reserves. InvestingPro data confirms the company's strong liquidity position, with a current ratio of 30.18 and more cash than debt on its balance sheet, though it's worth noting the company is quickly burning through its cash reserves.
The optimism for Tourmaline Bio's future is partly based on multiple upcoming events that could positively impact the company's stock value. These include the anticipated release of Phase 2 clinical trial data in the second quarter of 2025, as well as results from the SpiriTED Phase 2 study expected in the second half of the same year. Moreover, the market is awaiting Phase 3 data from competitors and the potential establishment of a partnership, which could offer valuable insights into the use of IL6i in treating ASCVD.
Despite the reduced price target, Truist Securities maintains a confident outlook on Tourmaline Bio, underlined by the reiterated Buy rating and the anticipation of significant developments for the company within the next 12 to 18 months. The firm's analysts highlight these upcoming catalysts as key drivers that could propel the stock forward.
In other recent news, Tourmaline Bio has reported its financial results for the fourth quarter and full year of 2024. The company experienced a net loss of $22.2 million for the fourth quarter, slightly higher than the projected $21.1 million loss. For the full year, the net loss amounted to $73.2 million. Despite these losses, analysts remain optimistic about the company's potential. H.C. Wainwright has increased the price target for Tourmaline Bio to $50, maintaining a Buy rating. Truist Securities also reiterated its Buy rating with a price target of $74, citing promising discussions with the company's management. The Phase 2 TRANQUILITY trial, anticipated to be a significant catalyst for Tourmaline Bio, is expected to release data in the second quarter of 2025. This trial is crucial for the company's cardiovascular treatment, Paci, which is viewed as a multi-billion dollar opportunity. The anticipation of upcoming trial results and potential strategic partnerships is contributing to a positive outlook for the company's future.
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