On Tuesday, Piper Sandler adjusted its stock price target for Cargo Therapeutics (NASDAQ:CRGX), a biotechnology company, to $34 from $37 while maintaining an Overweight rating on the stock. The firm's decision comes in light of recent developments in Cargo's clinical trials.
According to the analyst, the enrollment pace for the pivotal FIRCE-1 Phase 2 study has seen acceleration since the last update in June. The company has successfully dosed a total of 38 patients, which is an increase from the 20 patients reported earlier in June.
The analyst expects this enrollment rate to continue to pick up as all the trial sites are now fully operational. Management has maintained its guidance for an interim analysis of the FIRCE-1 trial in the first half of 2025. The firm anticipates that the results could be available around March or April of that year.
The positive outlook on patient enrollment progress and the upcoming interim analysis are seen as potential catalysts for Cargo Therapeutics' stock performance. The firm believes that as the interim analysis date for the FIRCE-1 trial approaches, Cargo Therapeutics is likely to outperform in its sector.
The Overweight rating suggests that Piper Sandler's analyst views the company's stock as a better value than others in the industry. This rating indicates that the firm believes Cargo Therapeutics has strong prospects and may offer a better return on investment compared to its peers. The revised price target of $34 reflects the firm's confidence in the company's ongoing clinical developments and future potential.
In other recent news, CARGO Therapeutics reported favorable outcomes from a Phase 1 study of firicabtagene autoleucel (firi-cel) in treating large B-cell lymphoma (LBCL), with a complete response rate of 53%. The company also secured approximately $110 million from a private investment in public equity financing. This move will support the preparation of a Biologics License Application for its Phase 2 study, FIRCE-1, and further development of its CRG-023 program.
In addition, CARGO Therapeutics has entered into a sublease agreement with Vaxcyte, Inc., aiming to maximize the utility of its headquarters in San Carlos, California. In coverage by analysts, Piper Sandler initiated coverage on CARGO Therapeutics with an Overweight rating, while Truist Securities maintained a Buy rating on the company's stock, adjusting its price target to $32 from $34.
Lastly, CARGO Therapeutics announced the appointment of Dr. Kapil Dhingra, a medical oncologist with over 25 years of experience, to its Board of Directors. These are recent developments in the company's ongoing efforts in the biotech sector.
InvestingPro Insights
InvestingPro data provides a deeper financial context for Cargo Therapeutics (NASDAQ:CRGX) amid Piper Sandler's updated outlook. With a market capitalization of $665 million, the company's financial health is a critical factor for investors.
The adjusted P/E ratio, reflecting losses, stands at -5.49, underscoring the company's current lack of profitability. This is echoed by a significant operating income loss of $122.27 million over the last twelve months as of Q1 2024. Furthermore, the stock's performance has been volatile, with a 1-month total return of -18.08% and a year-to-date total return of -37.37%, suggesting that the market has had a bearish stance on the stock recently.
InvestingPro Tips highlight that Cargo Therapeutics holds more cash than debt, which is a positive sign of liquidity. Moreover, the company's liquid assets exceed its short-term obligations, providing some financial stability. However, analysts indicate that the company is quickly burning through cash and does not expect it to be profitable this year.
These factors, combined with weak gross profit margins and an anticipated drop in net income, may be of concern to prospective investors. It's also noteworthy that Cargo Therapeutics does not pay dividends, which could influence investment decisions for those seeking income-generating stocks.
For investors seeking a more comprehensive analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/CRGX, which may provide further insights into Cargo Therapeutics' financial health and stock potential.
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