Gold prices bounce off 3-week lows; demand likely longer term
Adc Therapeutics SA shares plummeted to a 52-week low, trading at $1.36, as the market responded to a challenging year for the biotechnology firm. With a market capitalization of $132.28 million and negative EBITDA of $129.32 million, InvestingPro analysis indicates the company is currently undervalued. The company, which specializes in the development of antibody-drug conjugates for cancer treatment, has seen its stock price severely retract, marking a significant 1-year change with a decline of nearly 69.93%. Despite annual revenue of $70.84 million, investors have been cautious, reflecting concerns over the company’s pipeline progress and market competition. The current price level represents a critical juncture for Adc Therapeutics as it navigates through a period of heightened scrutiny and investor skepticism. InvestingPro subscribers have access to 11 additional key insights and a comprehensive Pro Research Report that provides deeper analysis of the company’s financial health and future prospects.
In other recent news, ADC Therapeutics reported its fourth-quarter 2024 earnings, revealing a mixed financial performance. The company posted an earnings per share (EPS) of -$0.25, surpassing analysts’ expectations of -$0.43, while revenue reached $16.91 million, falling short of the anticipated $18.85 million. Guggenheim Securities responded by adjusting its outlook on ADC Therapeutics, lowering the price target to $7 from $10 but maintaining a Buy rating. RBC Capital Markets also maintained its Outperform rating with a price target of $8, highlighting the importance of the upcoming year for the company’s Zynlonta expansion.
The sales of Zynlonta, ADC Therapeutics’ key drug, totaled $16.4 million in the fourth quarter, missing the anticipated $18.6 million and consensus estimate of $19.2 million. The company’s management attributed the decline in sales to increased competition in the Diffuse Large B-Cell Lymphoma (DLBCL) market. Despite this, RBC Capital expressed optimism for Zynlonta’s future, emphasizing the potential impact of upcoming LOTIS-5 and LOTIS-7 trial data expected in 2025. ADC Therapeutics is focusing on expanding Zynlonta’s clinical utility amidst a changing competitive landscape.
Guggenheim has updated its financial model for the company, projecting a more conservative timeline for Zynlonta’s potential expansion into second-line DLBCL treatment, now expected in 2027. Meanwhile, ADC Therapeutics ended 2024 with $251 million in cash, providing a runway into the second half of 2026. The company continues to focus on strategic growth initiatives, including expanding the use of Zynlonta and pursuing research collaborations in its early-stage solid tumor pipeline.
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