Piper Sandler has adjusted the price target for Cue Biopharma (NASDAQ: NASDAQ:CUE), a biopharmaceutical company, reducing it to $3.00 from the previous $8.00, while continuing to uphold an Overweight rating on the stock.
The firm's decision on Friday was influenced by Cue Biopharma's recent corporate restructuring efforts aimed at concentrating on autoimmune diseases, which includes a 25% reduction in workforce.
Cue Biopharma, in collaboration with its partner Ono Pharmaceutical, is progressing with the development of CUE-401, a treatment designed for autoimmune and inflammatory diseases. Additionally, the company is working on CUE-501, a therapeutic candidate for the ablation of B cells in autoimmune diseases.
The company has also reported promising results from its Phase II study of CUE-101 combined with Keytruda for patients with first-line recurrent/metastatic HPV+ head and neck squamous cell carcinoma (HNSCC).
The study showed a 46% objective response rate (ORR), a 79% disease control rate (DCR), a median progression-free survival (mPFS) of 5.8 months, and a 12-month overall survival (OS) rate of 96%. These findings were presented at the American Society of Clinical Oncology (ASCO) meeting.
Further research is ongoing with the Phase I study of CUE-102, another therapeutic candidate, with results expected by early 2025. Piper Sandler anticipates that Cue Biopharma will have multiple partnering opportunities for its pipeline, including CUE-501, CUE-101, and CUE-102.
Cue Biopharma concluded the first quarter of 2024 with a cash reserve of $41 million. The management now projects these funds to be sufficient to support the company's operations into mid-2025.
InvestingPro Insights
In light of Piper Sandler's recent price target adjustment for Cue Biopharma, investors may find additional context in the company's financial metrics and market performance. Cue Biopharma's market capitalization stands at a modest $34.21 million, and while the company has shown an impressive revenue growth of 1525% in the last twelve months as of Q1 2024, it's important to note that this growth comes from a very low base. Furthermore, the company's gross profit margin is significantly negative at -454.2%, indicating substantial costs relative to its revenues.
From an investment standpoint, two InvestingPro Tips are particularly pertinent: Cue Biopharma holds more cash than debt on its balance sheet, which aligns with the company's reported cash reserve of $41 million, providing a cushion for its operations into mid-2025. Additionally, analysts anticipate sales growth in the current year, which may offer some optimism for the company's future performance despite the current challenges.
Investors should also be aware of the company's recent stock performance. The price has fallen significantly over the last year, with a 1-year price total return of -81.44%. Such volatility could be a concern for potential investors looking for stability. However, those with a higher risk tolerance might be interested in the stock's potential upside, especially if they believe in the company's strategic refocus and pipeline potential.
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