Piper Sandler has reaffirmed its Overweight rating on Skye Bioscience (NASDAQ: SKYE), with a steady price target of $20.00. The firm's optimism is tied to Skye Bioscience's ongoing clinical trial for its drug nimacimab, aimed at treating obesity.
Skye Bioscience has launched the Phase II CBeyond study to evaluate the effectiveness of nimacimab in patients who are obese or overweight with related comorbidities. The study is set to include 120 participants, with each receiving either a weekly 200mg dose of nimacimab or a placebo over a 26-week period.
Additionally, a separate group will be administered Wegovy (semaglutide) in combination with either nimacimab or a placebo to explore potential additive effects on weight loss.
The trial is designed with the statistical power to detect an 8% weight loss difference from the placebo. The innovative aspect of this study is the combination of CB1 receptor inhibition and GLP-1 agonism, which has not been previously tested in Phase II trials.
Skye Bioscience recently appointed Dr. Puneet S. Arora as its new Chief Medical Officer, who brings over 15 years of experience in clinical trials, regulatory submissions, and medical affairs. Skye Bioscience has also initiated a Phase 2 clinical trial, CBeyond, for their novel CB1 inhibiting antibody nimacimab™, aimed at treating obesity.
In addition, Skye Bioscience has partnered with Beacon Biosignals to integrate sleep-related assessments into the CBeyond trial, given the correlation between obesity and sleep disorders. The company has also expanded its board with the appointment of Karen Smith, MD, Ph.D., MBA, LLM.
Analysts from Craig-Hallum and Oppenheimer have maintained their positive ratings on Skye Bioscience, reflecting confidence in the company's prospects. The Phase 2 trial of nimacimab™ is being closely watched by investors and industry experts, with interim data expected in the second quarter of 2025.
InvestingPro Insights
As Skye Bioscience (NASDAQ:SKYE) continues its clinical trials for nimacimab, investors are closely monitoring the company's financial health and market performance. According to InvestingPro data, SKYE's operating income, EBIT, and EBITDA for the last twelve months as of Q2 2024 stand at a negative $22.14 million, $22.14 million, and $22.02 million respectively, indicating financial challenges. Despite the clinical advancements, analysts have highlighted concerns, as reflected in the InvestingPro Tips which note that SKYE suffers from weak gross profit margins and is not expected to be profitable this year. Moreover, the stock has experienced significant volatility, with a price total return of -46.62% over the last three months and -56.17% over the last six months, yet it has shown a strong return of 85.4% over the last year.
These financial metrics and stock performance indicators are crucial for investors considering the potential risks and rewards associated with SKYE's stock. The company's ability to manage its debt, which is characterized as moderate, and its liquid assets exceeding short-term obligations, provide some financial stability. However, the lack of profitability over the last twelve months and the absence of dividends may give investors pause. For a more comprehensive analysis, there are additional InvestingPro Tips available, which can be found by visiting InvestingPro's SKYE page.
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