On Friday, Citi adjusted its outlook on Shattuck Labs (NASDAQ:STTK), reducing the stock price target to $9 from the previous $10 while retaining a Buy rating on the stock. The revision follows the company's latest clinical results, which showed encouraging response rates in two separate patient cohorts.
Shattuck Labs reported updated complete response rates (CRs) for their TP53m-AML and HR-MDS cohorts at 29% and 42%, respectively. These figures demonstrate an improvement compared to previous data and compare favorably with azacitidine monotherapy benchmarks, which show approximately 13-18% for TP53m-AML and 24-33% for HR-MDS.
The analyst noted that the CR rates might improve as there are patients in both cohorts who have been in treatment for around three to five months, which is close to the expected time to achieve a complete response. Moreover, the combination therapy of '154+aza' was highlighted as potentially having a better overall safety profile than the magrolimab+aza combination, although concerns were raised due to two treatment-related cardiac events.
Shattuck Labs is launching two non-registrational Phase 1b randomized trials, with results for the HR-MDS subgroup anticipated in the second half of 2025. These forthcoming trials are expected to offer further insights into the efficacy and safety of the treatment components.
InvestingPro Insights
In light of Citi's revised outlook on Shattuck Labs (NASDAQ:STTK), it is valuable for investors to consider additional financial metrics and InvestingPro Tips. Shattuck Labs currently holds a market capitalization of $295.29 million, with a notably high revenue growth of 282.93% over the last twelve months as of Q1 2024. Despite this impressive growth, the company's gross profit margin stands at -2611.12%, reflecting significant costs relative to revenue.
InvestingPro Tips suggest that Shattuck Labs has more cash than debt on its balance sheet, which can be a sign of financial stability. Moreover, the stock's recent performance indicates that it is in oversold territory according to the Relative Strength Index (RSI), which may interest value investors looking for potential rebound opportunities. Still, analysts are expecting a sales decline in the current year and do not anticipate the company to be profitable within this timeframe.
For investors seeking a comprehensive analysis, there are 12 additional InvestingPro Tips available, which can be accessed through the InvestingPro platform for Shattuck Labs. To enhance your investment research, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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