On Wednesday, H.C. Wainwright adjusted its outlook on AnaptysBio (NASDAQ: NASDAQ:ANAB), reducing the price target from $55.00 to $52.00 while maintaining a Buy rating on the stock. The firm cited AnaptysBio's third-quarter financial performance and projected increases in operating expenses as the basis for the adjustment.
AnaptysBio reported total operating expenses of $52.8 million for the third quarter of 2024, marking a slight rise from the second quarter of the same year. The operating loss for the quarter was $22.8 million, with earnings per share (EPS) at a loss of $1.14.
However, the company saw a significant increase in collaboration revenue, which climbed to $30 million in the third quarter from $11.0 million in the preceding quarter. This jump included a $15 million milestone payment and is primarily attributed to the sales of Jemperli and Zejula by GSK (LON:GSK), with whom AnaptysBio has a collaboration agreement.
Looking forward, H.C. Wainwright forecasts collaboration revenues for AnaptysBio to reach $64.2 million in 2024. The firm also expects a slight increase in operating expenses as AnaptysBio advances its three Phase 2 trials and prepares for potential Phase 3 studies. Consequently, total operating expenses for 2024 are estimated at $210.1 million, with an anticipated EPS of -$6.18.
The company concluded the third quarter with a robust cash and equivalents position of $458.0 million. H.C. Wainwright estimates that these reserves could sustain AnaptysBio's operations well into 2027. Despite the positive cash position, the firm has reduced the probability of success (POS) for AnaptysBio's rosnilimab, a treatment for rheumatoid arthritis (RA), to 50% from the previous 60%. This revision follows Eli Lilly (NYSE:LLY)'s decision to discontinue development of a similar drug, peresolimab, which influenced the lowered price target to $52.00.
In other recent news, AnaptysBio has been the focus of multiple financial firms following its release of third-quarter financial results and updates on clinical programs. Leerink Partners trimmed their target price to $45 but maintained an Outperform rating, citing the company's promising portfolio and undervalued stock. Guggenheim also reiterated its Buy rating on AnaptysBio, expressing optimism for the upcoming Phase IIb atopic dermatitis readout of ANB032, the company's BTLA agonist monoclonal antibody.
Piper Sandler maintained an Overweight rating on AnaptysBio, following the recent presentation of data at the United European Gastroenterology Week. The firm expressed strong conviction in the potential success of the ongoing 28-week Phase 2b ROSETTA study for rosnilimab, a PD-1 agonist, in patients with moderate to severe Ulcerative Colitis.
AnaptysBio reported a third-quarter net loss of $32.9 million, more favorable than Leerink's estimate of a $43.6 million loss. The company's cash, cash equivalents, and investments totaled $15.90 per share, and the company's management maintains that its cash runway is expected to extend through the end of 2026.
In terms of clinical developments, AnaptysBio's ANB032 is advancing to a Phase 2b ARISE-AD trial, and rosnilimab is proceeding to a Phase 2b RENOIR RA trial. Positive results have also been reported from the GEMINI-1 and GEMINI-2 Phase 3 trials for imsidolimab, a treatment for generalized pustular psoriasis.
InvestingPro Insights
Recent InvestingPro data and tips provide additional context to AnaptysBio's financial situation and market performance. The company's market capitalization stands at $600.37 million, reflecting its current valuation in the biotech sector. Despite H.C. Wainwright's optimistic outlook, InvestingPro Tips indicate that AnaptysBio is "quickly burning through cash" and "not profitable over the last twelve months," which aligns with the reported operating loss and negative EPS in the article.
The company's revenue growth is a bright spot, with InvestingPro data showing a remarkable 282.17% increase over the last twelve months and an even more impressive 804.67% growth in the most recent quarter. This substantial growth supports the article's mention of increased collaboration revenue, particularly from the GSK partnership.
However, investors should note that AnaptysBio's stock has faced challenges, with InvestingPro Tips highlighting that it has "taken a big hit over the last week" and "fared poorly over the last month." Specifically, the stock has seen a 10.37% decline in the past week and a 41.49% drop over the last month. These metrics provide important context to the company's current market position and may reflect investor reactions to recent developments, including the reduced probability of success for rosnilimab mentioned in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers 14 additional tips for AnaptysBio, providing a deeper understanding of the company's financial health and market position.
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