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Investing.com - Wolfe Research downgraded 89bio Inc. (NASDAQ:ETNB) from Outperform to Peerperform following recent acquisition developments. The stock has surged 85% in the past week and is currently trading near its 52-week high of $15.06, with InvestingPro data indicating overbought conditions.
The research firm cited limited potential for further stock movement as the acquisition appears to be fully priced into the current share value.
Wolfe Research expressed confidence that the deal will proceed without regulatory hurdles, noting Roche’s minimal presence in the NASH (non-alcoholic steatohepatitis) market, which reduces antitrust concerns.
The firm assumes the 89bio board unanimously approved the transaction and expects shareholders to be satisfied with the premium compared to Boston Pharma’s previous $2 billion takeout price.
Wolfe Research established a fair value range of $14.50 to $20.50 per share for 89bio stock and considers the likelihood of another buyer emerging to be low.
In other recent news, Roche has announced its acquisition of 89bio Inc. for $14.50 per share in cash, along with a contingent value right (CVR) potentially worth up to $6 per share. This acquisition could value the transaction at up to $3.5 billion, contingent on achieving specific milestones. The deal, expected to close in the fourth quarter of 2025, focuses on 89bio’s pegozafermin, a promising treatment in late-stage development for Metabolic Dysfunction-Associated Steatohepatitis (MASH). In analyst actions, H.C. Wainwright initiated coverage on 89bio with a Buy rating, citing the potential of pegozafermin, while RBC Capital adjusted its price target for 89bio to $11, down from $12, due to model updates. Despite the lowered price target, RBC maintained a Sector Perform rating, noting the ongoing progress of 89bio’s Phase III MASH studies. These recent developments highlight the strategic interest in 89bio’s innovative approaches to liver disease treatment.
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