On Wednesday, H.C. Wainwright maintained its Buy rating and a $9.00 price target on shares of Alpha Tau Medical Ltd. (NASDAQ:DRTS). The firm's optimism follows the company's recent financial results and updates on several clinical trials. Last week, Alpha Tau Medical disclosed its second-quarter financials for 2024, reporting a net loss of $7.4 million or $0.11 per share, which was notably lower than the anticipated $8.1 million loss.
The company's management highlighted several key developments in its pipeline. The ReSTART U.S. pivotal trial for Alpha DaRT, aimed at treating recurrent cutaneous squamous cell carcinoma, is expected to complete patient enrollment by the end of 2024. Additionally, the Canadian trial focusing on advanced inoperable pancreatic cancer is on track to deliver data on safety, feasibility, and efficacy by the end of the first quarter of 2025.
Alpha Tau Medical is also awaiting a potential pre-market approval from the PMDA in Japan for Alpha DaRT in patients with recurrent head and neck cancer, with a response anticipated by the end of 2024. The company is expanding its clinical trials to include other cancer types, with plans to treat the first patient in Israel suffering from recurrent lung cancer in the second half of 2024. The treatment of the first patient with brain cancer is also slated for the second half of the year.
These forthcoming clinical and regulatory milestones have reinforced H.C. Wainwright's positive stance on Alpha Tau Medical's stock. The firm's reiteration of the Buy rating and the $9 price target reflects confidence in the company's ongoing and future initiatives in its clinical trial programs.
In other recent news, Alpha Tau Medical Ltd. reported its second-quarter results, which included an operating loss of $9.1 million, slightly higher than the expected $8.9 million by analysts. However, the company's cash burn during the quarter was relatively low at approximately $7 million. Piper Sandler, an analyst firm, maintained its Overweight rating on the company and a $7.00 stock price target, citing the company's efficient financial management and the progression of its clinical trials.
The firm also noted that Alpha Tau Medical's pivotal U.S. trial is progressing, with full enrollment anticipated by the end of the year. Additionally, the company's pancreatic feasibility studies are expected to release data in the first quarter of 2025. Piper Sandler expressed optimism about the company's lead indication for recurrent cutaneous squamous cell carcinoma (cSCC), which is on track for FDA submission in the second half of 2025.
In another recent development, Alpha Tau Medical reported an operating loss of $8.4 million in the first quarter, a figure lower than the anticipated $9.8 million loss predicted by Wall Street analysts.
The company also disclosed a consistent and low cash burn rate of approximately $4 million. Piper Sandler noted that the current trials and milestones are progressing as planned, with no significant changes since the last update.
InvestingPro Insights
Amidst the clinical advancements and financial updates from Alpha Tau Medical Ltd. (NASDAQ:DRTS), InvestingPro provides key insights into the company's financial health and market performance. Notably, Alpha Tau Medical holds more cash than debt on its balance sheet, which could provide a cushion for its ambitious clinical trial programs. Additionally, the company's liquid assets exceed its short-term obligations, suggesting a stable financial position for the near future.
While H.C. Wainwright maintains a bullish outlook with a $9.00 price target, it's important to consider that analysts do not expect the company to be profitable this year, and it has not been profitable over the last twelve months. Furthermore, the company does not pay a dividend, which may influence investment strategies focused on income generation. Despite these challenges, two analysts have revised their earnings upwards for the upcoming period, indicating potential optimism in the company's growth prospects.
On the market front, Alpha Tau Medical's market capitalization stands at $152.16 million, with a negative price-to-earnings (P/E) ratio of -5.48, reflecting the company's current lack of profitability. The stock has experienced a 3.81% increase in the last month, yet it has seen a significant decline over the past six months, dropping by 28.52%. This volatility highlights the speculative nature of investing in a company deeply engaged in clinical development.
For more detailed analysis and additional InvestingPro Tips related to Alpha Tau Medical, including metrics on gross profit margins and price performance relative to 52-week highs, investors can visit InvestingPro. There are 6 more tips available that can provide deeper insights into the company's financials and market position.
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