On Thursday, Keros Therapeutics (NASDAQ:KROS) saw its price target increased by Guggenheim from $96.00 to $102.00. The firm has maintained a Buy rating on the stock. The stock has shown remarkable momentum, gaining over 15% in the past week and 70% year-to-date. This revision follows the company's recent license agreement with Takeda for the global development and commercialization of its hematology asset, elritercept.
The agreement with Takeda is seen as a strategic move for Keros, bolstering its financial position and enabling a stronger focus on developing other assets, including cibotercept. According to InvestingPro data, the company maintains a strong financial position with a current ratio of 19.03 and more cash than debt on its balance sheet. Cibotercept is currently approaching a critical phase in its development, with Phase 2 topline data expected in the second quarter of 2025 for its application in treating pulmonary arterial hypertension (PAH).
Guggenheim's updated company model for Keros includes alterations to alliance revenue estimates for both elritercept and cibotercept. The firm also adjusted its long-term sales, general, and administrative (SG&A) expense estimates upward and reduced its long-term research and development (R&D) estimates. These changes reflect the latest developments and the impact of the Takeda agreement on Keros's financial outlook.
The analyst from Guggenheim expressed a positive outlook on the license agreement, noting its potential to strengthen Keros's balance sheet. The focus now shifts to cibotercept and other early-stage assets like KER-065. The updated model and estimates aim to provide a detailed rationale for each adjustment made in light of the company's current status.
In conclusion, Guggenheim reiterated its Buy rating on Keros Therapeutics and raised its discounted cash flow (DCF)-derived price target to $102.00, signaling confidence in the company's future performance following the recent developments. InvestingPro analysis shows analyst targets ranging from $76 to $113, with a strong consensus recommendation of 1.2 (Strong Buy). Subscribers to InvestingPro can access 12 additional key insights about KROS's financial health and market position.
In other recent news, Keros Therapeutics has been making significant strides in its clinical trials and operational developments. The company has entered into a licensing agreement with Takeda, focusing on the development of elritercept. This deal includes an upfront payment of $200 million to Keros, and potential milestone payments that could reach $1.1 billion. BofA Securities, Jefferies, and Piper Sandler have all maintained positive ratings for Keros Therapeutics, citing the potential of its leading drug candidates and promising pipeline.
Keros Therapeutics recently completed patient enrollment for its Phase 2 TROPOS trial, surpassing the initial target by enrolling 113 patients. The trial is studying the potential of cibotercept in treating pulmonary arterial hypertension (PAH) patients, with top-line data expected to be reported in the second quarter of 2025. Dr. Yung H. Chyung has been appointed as the new Chief Medical (TASE:PMCN) Officer, a strategic move as the company prepares for significant clinical milestones.
Several analyst firms, including Truist Securities, Cantor Fitzgerald, Leerink Partners, and Guggenheim, have highlighted Keros Therapeutics' proficiency in the TGF-β pathway, a key area in addressing certain chronic diseases. These firms anticipate significant developments for Keros Therapeutics by 2025, including the expected release of Phase 2 data for Myelofibrosis (MF) and a potential update on discussions with the FDA.
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