On Friday, Goldman Sachs (NYSE:GS) adjusted its stance on Intellia Therapeutics (NASDAQ:NTLA), downgrading the stock from Buy to Neutral and setting a new price target of $32.00. The change follows Intellia's fourth-quarter earnings report and a reiteration of its near-term catalysts for its in vivo CRISPR gene-edited therapies. The company's pipeline includes longer-term Phase 1 data from NTLA-2001, which targets ATTR-cardiomyopathy and ATTR-polyneuropathy, expected this year.
Intellia is also preparing to initiate a Phase 3 study for NTLA-2002, aimed at treating hereditary angioedema, in the second half of 2024, pending regulatory approval. The study design will be informed by updated Phase 1 and new Phase 2 data, which are also anticipated this year. Additionally, the company plans to begin a Phase 1 study for NTLA-3001, which addresses AATD-associated lung disease, with the dosing of the first patient expected in 2024.
Despite the downgrade, Goldman Sachs acknowledged the significant value proposition of Intellia's science-forward approach and its potential to develop functionally curative therapies.
"Overall, while we remain positive on NTLA's science-forward approach and ability to develop functionally curative therapies, which we acknowledge represents a significant value proposition, we take a more measured outlook on NTLA-2001™s opportunity in ATTR given competitive (ALNY™s Amvuttra, BBIO's acoramidis (November 29 PDUFA); AZN/IONS' Ph3 Wainua data in 2025) and commercial dynamics, alongside a quieter near-term catalyst path," said the analysts.
The firm's statement highlighted the belief that the NTLA-2001 program is largely de-risked based on prior data, which includes sustained TTR knockdown and safety. Nevertheless, the competitive landscape and a quieter near-term catalyst path have led to a more conservative expectation for the stock's performance.
InvestingPro Insights
As investors digest the recent downgrade of Intellia Therapeutics (NASDAQ:NTLA) by Goldman Sachs, a look at the company's financial health and market performance through InvestingPro provides additional context. With a market capitalization of $2.34 billion, Intellia is positioned as a notable player in the biotech sector. However, it's important to note the company's P/E ratio, which stands at -4.86, reflecting its current lack of profitability—a point also underscored by analysts who do not anticipate the company will be profitable this year.
InvestingPro Tips reveal that while Intellia holds more cash than debt on its balance sheet, it is rapidly consuming cash and has weak gross profit margins, which could impact its ability to sustain long-term research and development. Despite these challenges, the company's stock price has shown a strong return over the last five years, indicating a history of investor confidence in its growth potential and scientific advancements.
For those considering an investment in Intellia, it's worth noting that the company's liquid assets exceed its short-term obligations, which may provide some financial stability as it navigates the competitive landscape of gene-editing therapies. Additionally, with a fair value estimation by InvestingPro of $30.62, there appears to be room for growth compared to the current price, which stands at $27.18. Investors may find further insights and additional tips on Intellia Therapeutics by visiting InvestingPro, where 9 more tips are available to guide investment decisions. Remember to use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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