On Wednesday, Morgan Stanley updated its outlook on Crinetics Pharmaceuticals (NASDAQ:CRNX), raising the price target on the company's shares to $70 from the previous $50, while maintaining an Overweight rating. This adjustment comes after the early release of ENDO abstracts, which included promising Phase 2 data for Crinetics' drug atumelnant.
The analyst from Morgan Stanley expressed optimism regarding the drug's competitive profile for treating conditions such as congenital adrenal hyperplasia (CAH) and Cushing's syndrome. The anticipation of further results to be presented at the ENDO conference on June 3 supports the belief in atumelnant's robust profile.
Additionally, the analyst cited long-term safety data for another of Crinetics' drugs, paltusotine, which could potentially support its filing for the treatment of acromegaly. The firm's updated model reflects increased probabilities of success for atumelnant in CAH and Cushing's syndrome to 65%, up from 40%. Similar revisions were made for paltusotine, with the probability of success in acromegaly maintenance and treatment raised to 80-85% from 75-80%, and for carcinoid syndrome to 65% from 50%.
The revisions to the model also include an adjusted estimated share count for 2024. These changes collectively contributed to the new price target of $70 for Crinetics Pharmaceuticals' stock. The analyst concluded that the company's shares are well positioned as they head into the Late-Breaking presentations at the ENDO conference, with additional pipeline developments expected to provide further upside within the year.
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