On Thursday, Jones Trading adjusted its outlook on Acrivon Therapeutics Inc (NASDAQ:ACRV), reducing the stock price target to $22 from the previous $26 while maintaining a Buy rating on the stock. The revised price target comes after a closer examination of the company's recent clinical data, which was somewhat underwhelming but still showed potential in certain areas.
Acrivon Therapeutics reported an Objective Response Rate (ORR) of 40% in patients with ovarian cancer who were positive for OncoSig, a proprietary biomarker used by the company. However, the OncoSig negative cohort did not show any clinical responses.
Moreover, the ORR was 60% for patients with endometrial cancer who were OncoSig positive. The findings indicated that 34% of the enrolled patients were OncoSig positive, which aligns with previous guidance from the company.
The analyst at Jones Trading highlighted the decision to remove bladder cancer from their valuation model until further clinical data becomes available, which is expected in the next 6-9 months. This adjustment is a result of the current data not fully meeting the base case scenario expectations initially set for the company's drug pipeline.
Due to the updated clinical data, Jones Trading has revised its forecast for Acrivon's peak sales, lowering the probability-adjusted peak sales estimate to $450 million from the earlier projection of $570 million for the year 2034. Despite this reduction, Jones Trading reiterated its Buy rating, indicating a continued positive outlook on the company's stock.
InvestingPro Insights
As Acrivon Therapeutics Inc (NASDAQ:ACRV) navigates through its clinical trials with mixed results, investors may be looking for additional context to assess the company's financial health and future prospects.
According to InvestingPro data, Acrivon has a market capitalization of approximately $293.3 million, with a negative P/E ratio of -4.53 reflecting its current lack of profitability. The company's liquidity seems strong, with liquid assets that exceed its short-term obligations, which may provide some cushion as it continues to burn through cash.
Despite recent setbacks, Acrivon has experienced a large price uptick over the last six months, with a 77.57% return, and a notable 93.09% year-to-date price total return. However, it's important to note that the company does not pay dividends, which may influence the investment strategies of income-seeking shareholders.
InvestingPro Tips suggest that while Acrivon holds more cash than debt, analysts are concerned about its cash burn rate and have revised their earnings estimates downwards for the upcoming period. Additionally, the stock has seen a significant hit over the last week, but it's worth noting that there are still 12 additional tips available on InvestingPro for those looking for a deeper dive into Acrivon's performance and outlook. Investors interested in these insights can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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