On Friday, H.C. Wainwright adjusted its price expectations for Inventiva SA (NASDAQ:IVA), reducing the price target to $14 from the previous $22, while reaffirming a Buy rating on the stock. The revision follows Inventiva's announcement on September 25 that the NATiV3 Phase 3 trial for lanifibranor, aimed at treating non-cirrhotic MASH, is on track to finish patient screening by the end of the year.
The last patient is anticipated to be randomized in the first half of 2025, with top-line data expected in the second half of 2026. This represents a minor delay from the initial forecast issued in July, which anticipated results at the beginning of the second half of 2026.
Inventiva's NATiV3 trial is progressing with patient screening at 359 sites across 24 countries. To date, the main cohort has randomized 837 patients, surpassing 85% of the enrollment goal. The exploratory cohort has randomized 296 patients, exceeding the initial target of 200. Notably, 13% of the patients in the main cohort were receiving a stable dose of GLP-1 agonist at baseline, which will allow researchers to evaluate the combined effect with lanifibranor.
H.C. Wainwright's confidence in the NATiV3 trial's success is grounded in the positive outcomes from the 24-week Phase 2b NATIVE study, particularly lanifibranor's effect on MASH resolution and fibrosis improvement. These results, detailed in a report from November 22, 2021, initially led to a raised price target to $42 based on the comprehensive analysis of the Phase 2b NATIVE dataset.
However, Inventiva is currently facing significant financial pressure, with existing cash reserves estimated to last only until mid-October 2024, which is approximately three weeks from now. This financial situation has led to the moderated price target for Inventiva shares, reflecting the increased financial and execution risks.
Despite these concerns, the firm maintains its Buy rating, underpinned by lanifibranor's demonstrated efficacy profile in MASH.
In other recent news, Inventiva SA has been under the financial microscope following a revised outlook from Stifel. The firm has downgraded the biopharmaceutical company's stock target to $20.00 from $25.00, although it maintains a Buy rating.
This adjustment is in response to Inventiva's first-half 2024 financial report which raised concerns about the company's financial stability and lacked a conclusive review from its Statutory Auditors. Despite extending its cash runway by two weeks to mid-October 2024, and raising an additional €20.1 million through the issuance of royalty certificates in July, Inventiva's financial situation has shown little improvement.
The company is reportedly exploring support from strategic partners as most non-dilutive financing avenues seem to have been exhausted. Additionally, Inventiva's clinical program, NATiV3, has faced delays with enrollment completion now expected in the first half of 2025.
InvestingPro Insights
In light of H.C. Wainwright's recent price target adjustment for Inventiva SA (NASDAQ:IVA), a glance at the real-time metrics from InvestingPro provides a more nuanced perspective on the company's financial health and stock performance. Notably, Inventiva's impressive gross profit margin of 94.72% over the last twelve months as of Q2 2024 stands out, underscoring the company's ability to retain a significant portion of its revenue after accounting for the cost of goods sold. This metric is particularly relevant when considering the company's operational efficiency and potential for profitability once its product reaches the market.
However, the stock's recent performance paints a challenging picture. The price has taken a significant hit, with a 26.34% decline over the last month and a more pronounced 53.14% drop over the previous six months. These figures suggest that investor sentiment is currently bearish, which aligns with the "oversold" signal indicated by the Relative Strength Index (RSI). Investors considering Inventiva's stock should be aware that while the company does not pay dividends, which could be a factor for those seeking income-generating investments, the InvestingPro Tips highlight that analysts do not anticipate the company will be profitable this year, nor was it profitable over the last twelve months.
For readers interested in a deeper dive, there are additional InvestingPro Tips available, offering insights that could guide investment decisions regarding Inventiva. These tips and a more comprehensive analysis can be found on the InvestingPro platform at https://www.investing.com/pro/IVA.
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