Friday, Cantor Fitzgerald reaffirmed its Overweight rating on ALX Oncology (NASDAQ:), following the presentation of positive Phase 2 ASPEN-6 study results. According to InvestingPro data, the company’s stock has seen significant volatility, currently trading well below its 52-week high of $17.82, though analysis suggests the stock may be undervalued at current levels. The study evaluated evorpacept, an anti-CD47 therapy, in combination with other treatments for HER2+ gastric cancer. The data was shared at the American Society of Clinical Oncology Gastrointestinal Cancers Symposium (ASCO-GI).
Stifel analysts expressed a positive view on the new data, highlighting that the results for confirmed HER2+ patients, identified through fresh biopsy or circulating tumor DNA (ctDNA), were particularly promising. This aligns with previous observations from a breast cancer trial, suggesting a consistent mechanism of action for evorpacept.
The ASPEN-6 study’s progression-free survival (PFS) data is seen as a significant step for ALX Oncology, which specializes in developing therapies that block the CD47 checkpoint pathway. This pathway is often exploited by cancer cells to avoid being destroyed by the immune system. By inhibiting CD47, evorpacept aims to enhance the body’s immune response against cancer cells. While the company maintains a strong liquidity position with a current ratio of 4.82 and more cash than debt, InvestingPro analysis indicates rapid cash burn remains a key consideration for investors.
The positive outcome from the ASPEN-6 study could bolster investor confidence in ALX Oncology’s approach to cancer treatment, particularly in the area of HER2+ gastric cancer. Gastric cancer remains a challenging disease with limited treatment options, and advancements in this field are closely monitored by healthcare professionals and investors alike.
ALX Oncology’s focus on targeted cancer therapies, such as evorpacept, positions the company at the forefront of immunotherapy research. The continued support from analysts like those at Cantor Fitzgerald underscores the potential of ALX Oncology’s pipeline and its commitment to addressing unmet medical needs in oncology. With analyst price targets ranging from $2 to $25, and multiple additional insights available on InvestingPro, investors can access comprehensive analysis to evaluate the company’s potential in this dynamic sector.
In other recent news, ALX Oncology has been the subject of several analyst reports and significant clinical trial outcomes. H.C. Wainwright revised its price target for ALX Oncology to $5, down from $25, while maintaining a Buy rating. The adjustment followed the release of data from ALX Oncology’s Phase 2 ASPEN-06 study, which reported a strong objective response rate in patients treated with the Evo/TRP combination for HER2+ gastric and gastroesophageal junction cancer.
In contrast, Jefferies downgraded ALX Oncology’s stock from ‘Buy’ to ‘Hold’, reducing the price target from $12.00 to $2.00 due to uncertainty in the company’s 2025 readouts. However, Stifel maintained its Hold rating on the company’s shares, following positive results from a clinical trial involving ALX Oncology’s product, evo, and JAZZ Pharmaceuticals’ zanidatamab.
ALX Oncology announced the adoption of a new equity incentive plan, reserving 1.5 million shares of common stock for issuance in various forms of equity awards. The company also reported positive outcomes from its ASPEN-06 Phase 2 clinical trial, demonstrating significant tumor response in patients with HER2-positive advanced gastric cancer using the drug evorpacept. The U.S. Food and Drug Administration granted Fast Track designation for evorpacept as a second-line treatment for this type of cancer.
The company also saw the resignation of its Chief Medical (TASE:) Officer, Sophia Randolph, who will continue to provide consulting services for up to 18 months. These developments highlight the ongoing activities and strategic shifts within ALX Oncology.
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