Piper Sandler reaffirmed its Overweight rating and $175.00 price target for Aligos Therapeutics Inc. (NASDAQ: ALGS).
The firm's analyst emphasized the potential for ALGS's ALG-000184, a candidate for chronic hepatitis B (CHB) treatment, following the FDA's approval to proceed with a Phase 2 head-to-head study against current nucleos(t)ide (NUC) therapies.
The study aims to establish ALG-000184 as a first-line (1L) therapy.
The analyst highlighted the significance of the CHB market, noting that it encompasses approximately 2 million addressable patients in the United States. In 2023, the sales of currently approved NUC standard of care (SoC) drugs neared the $1 billion mark, underscoring the substantial market potential for new treatments.
The analyst addressed 18 investor questions, asserting that data demonstrating ALG-000184's superiority over NUCs considerably reduces the investment risk and could revolutionize the CHB treatment landscape.
The upcoming Investigational New Drug (IND) submission for ALG-000184 is scheduled for the first quarter of 2025, with the Phase 2 study expected to commence within the same year. The analyst also noted the pharmaceutical industry's commitment to addressing CHB, with six companies already having approved treatment franchises in the market.
In other recent news, Aligos Therapeutics has regained compliance with Nasdaq's minimum bid price requirement, averting the risk of delisting from the exchange. The development comes after the company received a notification from Nasdaq last year indicating that its common stock had not maintained the required minimum bid price for 30 consecutive business days.
Additionally, Aligos Therapeutics has been the subject of several analyst notes. H.C. Wainwright initiated coverage on Aligos Therapeutics with a Buy rating, emphasizing the potential of ALG-055009 in a Phase 2a study and ALG-000184 in a Phase 1b trial. Meanwhile, Piper Sandler maintained an Overweight rating on Aligos, citing the potential of ALG-000184 for chronic hepatitis B patients.
The firm also expects significant events for Aligos with the anticipated Phase 2 HERALD trial results. Furthermore, Aligos reported promising Phase 1 results for its pan-coronavirus protease inhibitor, ALG-097558. The company also received shareholder approval to increase its authorized common stock from 300 million to 500 million shares and made amendments to its 2020 Incentive Award Plan.
InvestingPro Insights
Piper Sandler's reaffirmation of an Overweight rating for Aligos Therapeutics Inc. (NASDAQ:ALGS) aligns with several InvestingPro Tips that shed light on the company's financial health and market performance. Notably, ALGS holds more cash than debt on its balance sheet, providing a degree of financial stability as it progresses with its Phase 2 study for ALG-000184. However, analysts point out that the company is rapidly burning through cash, which is a common scenario for biotech firms in the drug development stage. This cash burn could be a factor in the anticipated sales decline in the current year.
InvestingPro Data further complements this analysis with real-time metrics. Aligos Therapeutics has a market cap of approximately $85.07M and is trading at a low revenue valuation multiple, indicating that the stock might be undervalued relative to its sales. Despite a significant return over the last week, the company's stock price movements have been quite volatile, which is a characteristic investors should consider, especially in the biotech sector.
For those interested in deeper financial analysis, InvestingPro provides additional tips on Aligos Therapeutics, available at https://www.investing.com/pro/ALGS. These include insights on profitability, valuation, liquidity, and dividend policies, which can be instrumental in making informed investment decisions.
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