Bullish indicating open at $55-$60, IPO prices at $37
CAMBRIDGE, Mass. - Prime Medicine, Inc. (NASDAQ:PRME), a biotechnology company focused on genetic therapies, announced Wednesday it has commenced an underwritten public offering of its common stock. The company, currently trading at $3.92 and with a market capitalization of about $502 million, has seen its shares rise over 31% year-to-date according to InvestingPro data.
The company plans to grant underwriters a 30-day option to purchase up to an additional 15% of the shares offered. All shares in the proposed offering will be sold by Prime Medicine. Based on InvestingPro’s Fair Value analysis, the stock appears slightly undervalued at current levels.
TD Cowen and BMO Capital Markets are serving as joint book-running managers for the offering. The shares will be offered pursuant to an effective shelf registration statement previously filed with the U.S. Securities and Exchange Commission on November 3, 2023.
Prime Medicine noted in its press release statement that the offering is subject to market and other conditions, with no assurance regarding completion timing, size, or terms.
The biotechnology company describes itself as focused on developing a new class of genetic therapies using its proprietary Prime Editing platform. The company is advancing a portfolio of investigational therapeutic programs targeting liver, lung, immunology and oncology applications. While showing promising technology potential, InvestingPro data reveals the company’s overall financial health score as weak, with analyst price targets ranging from $1.50 to $12.00 per share, reflecting the early-stage nature of its development programs.
A preliminary prospectus supplement describing the offering terms will be filed with the SEC and made available on the SEC’s website, according to the company.
The announcement comes as Prime Medicine continues its work on gene editing technologies designed to make precise edits within genes while minimizing unwanted DNA modifications. The company maintains a strong liquidity position with a current ratio of 4.78, though it reported an EBITDA of -$200 million in the last twelve months. For deeper insights into Prime Medicine’s financial health and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which includes detailed analysis of over 1,400 US stocks.
In other recent news, Prime Medicine announced it has secured up to $24 million in funding from the Cystic Fibrosis Foundation to advance the development of Prime Editors aimed at treating cystic fibrosis-related lung disease. This funding will be distributed in two tranches, with the first including a $6 million equity investment in the company. The partnership with the Cystic Fibrosis Foundation is part of an expanded agreement initially established in January 2024. Analyst firm JMP Securities has reiterated its Market Outperform rating and maintained a $6.00 price target on Prime Medicine, citing the company’s leadership in Prime Editing technology. However, Citi analysts downgraded Prime Medicine’s stock from Buy to Neutral and slashed the price target to $1.50, expressing concerns about the company’s financial runway and its ability to achieve significant value milestones. Despite this downgrade, Prime Medicine continues to leverage its preclinical data and expertise in prime editing to secure business development deals that might extend its financial resources. H.C. Wainwright also reiterated its Neutral rating on the company following the expanded CF Foundation partnership. The recent developments reflect a mix of optimism and caution among analysts regarding Prime Medicine’s future prospects.
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