On Thursday, Stifel financial firm adjusted its outlook on Repare Therapeutics (NASDAQ:RPTX), reducing the stock's price target from $13.00 to $9.00. Despite the lowered price target, Stifel maintained a Buy rating on the company's shares.
The revision follows the presentation of full Phase 1 data at the ESMO-GI conference, which highlighted a control benefit rate (CBR) of 46.7% in colorectal cancer (CRC) patients treated with lunresertib in combination with FOLFIRI chemotherapy.
The data showed that out of 15 patients, there was one partial response (PR) observed. The analyst noted that expecting a clear efficacy signal from a FOLFIRI combo regimen might be challenging, especially considering that two-thirds of the patients had prior exposure to irinotecan, a component of FOLFIRI.
While the CBR was deemed interesting given the current standard of care (SoC) options, the lack of a strong overall response rate (ORR) signal has led to a reassessment of the drug's potential durability.
In response to the findings, Stifel has adjusted the probability of success (PoS) for lunresertib from 25% to 20% and has also reduced the expected duration of use from nine months to seven months. These changes have collectively influenced the decision to lower the target price to $9 per share.
Still, the firm's Buy rating is sustained, with a focus on the potential success of lunresertib in combination with camonsertib for treating gynecological tumors, with data expected in late Q4 2024.
Furthermore, management at Repare Therapeutics has expressed optimism about the combination of lunresertib with Debio-0123 (WEE1 inhibitor), with data anticipated in 2025. This expectation adds to the rationale behind Stifel's continued endorsement of the stock.
In other recent news, Repare Therapeutics Inc. has reported encouraging initial data from its MINOTAUR Phase 1 clinical trial of lunresertib. The trial, focusing on patients with gastrointestinal tumors, showed an overall response rate of 18.2% and a clinical benefit rate of 51.5%.
Moreover, Repare Therapeutics has expanded its TRESR clinical trial for non-small cell lung cancer (NSCLC) following favorable results with camonsertib, a therapy candidate that demonstrated extended progression-free survival in patients with ATM-mutated NSCLC.
The U.S. Food and Drug Administration (FDA) has granted Fast Track designation to Repare Therapeutics' ovarian cancer drug combination, lunresertib and camonsertib, intended to expedite the development and review of treatments for serious conditions.
In leadership news, Dr. Steven H. Stein will join the Board of Directors of Repare Therapeutics, replacing Todd Foley. These recent developments highlight the ongoing efforts of Repare Therapeutics in advancing precision oncology treatments.
InvestingPro Insights
Amidst the recent adjustments in Repare Therapeutics' outlook by Stifel, InvestingPro data and tips provide additional context for investors considering the company's stock. Repare Therapeutics holds a market cap of $143.04M and has experienced significant price volatility, with a 1-year price total return of -70.52%. The company's price-to-book ratio stands at 0.62 as of the last twelve months leading up to Q1 2024, suggesting that the stock might be undervalued relative to its assets.
Notably, Repare Therapeutics has more cash than debt on its balance sheet, which can be a sign of financial stability, an important factor for investors to consider given the company's current phase of development. Moreover, the company's liquid assets exceed its short-term obligations, indicating a solid position to cover immediate liabilities.
Still, it is important to note that analysts do not expect the company to be profitable this year, and it has not been profitable over the last twelve months. Three analysts have revised their earnings upwards for the upcoming period, potentially signaling a change in the company's prospects.
For investors seeking a deeper dive into Repare Therapeutics, there are additional InvestingPro Tips available that could further inform investment decisions. Subscribers can access these insights and more by taking advantage of a special offer using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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