Tuesday, H.C. Wainwright adjusted its outlook on Carisma Therapeutics Inc (NASDAQ: CARM), lowering the price target to $9.00 from the previous $11.00, while reaffirming a Buy rating on the stock. The revision follows Carisma's announcement on Monday of a strategic shift in its pipeline priorities, which includes changes to ongoing program efforts.
The firm noted that Carisma has decided to discontinue the development of CT-0508, an anti-HER2 CAR-Macrophage therapy, in favor of advancing CT-0525, an anti-HER2 CAR-Monocyte therapy. This decision will require investors to wait until 2025 for more comprehensive combination data for the new mechanism in conjunction with Keytruda (pembrolizumab), a cancer immunotherapy drug.
Carisma has currently enrolled six patients in the CT-0508 (CAR-M) + Keytruda Phase 1 substudy, with expectations to present data for this group in the second quarter of 2024. This is a reduction from the previously anticipated nine patients' worth of data prior to the strategic shift.
H.C. Wainwright has adjusted its valuation to include CT-0525 and remove CT-0508, considering the market opportunities for both programs nearly equivalent. The timeline for the estimated launch of the new therapy has also been revised to 2027, a year later than initially projected.
The firm anticipates receiving additional validating monotherapy data by the end of 2024, followed by a more robust set of combination data through CT-0525 in 2025. The updated 12-month price target reflects these changes and the new timelines introduced by Carisma's pipeline reprioritization.
InvestingPro Insights
As Carisma Therapeutics Inc (NASDAQ: CARM) navigates its strategic pipeline shifts, InvestingPro data and tips offer a deeper financial perspective on the company's current status. With a market capitalization of $84.35 million, Carisma's valuation reflects the challenges it faces. The company's price-to-earnings (P/E) ratio stands at -0.97, indicating that investors are pricing in the absence of net income over the last twelve months as of Q1 2023. Despite a significant 51.71% revenue growth in the same period, Carisma's operating income margin was deeply negative at -544.55%, reflecting substantial operational costs relative to its revenue.
Among the InvestingPro Tips, two are particularly pertinent to the article's context: Carisma holds more cash than debt, which could provide some financial flexibility during its pipeline transition, and the company's liquid assets exceed short-term obligations, suggesting a degree of short-term financial stability. However, with analysts not expecting profitability this year and a forecasted drop in net income, the financial outlook remains cautious.
For investors seeking more comprehensive analysis and additional InvestingPro Tips, there are 12 more tips available for Carisma on InvestingPro. Using the coupon code PRONEWS24, interested readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which could prove invaluable in making informed investment decisions during such pivotal times for the company.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.