Piper Sandler has increased the price target on Scholar Rock (NASDAQ: SRRK) to $42.00, up from the previous $28.00, while maintaining an Overweight rating on the stock.
The adjustment follows the company's recent financing round, which the analyst believes strengthens its position for an anticipated regulatory submission for its drug candidate, apitegromab.
Scholar Rock's recent financing involved a share offering of approximately 10.6 million shares, which was less than the 16 million share financing previously anticipated for the fourth quarter of 2024. This development prompted Piper Sandler to update its financial model for the company.
Piper Sandler expressed continued confidence in the potential of apitegromab, citing Phase 3 SAPPHIRE data and long-term follow-up data from the Phase 2 TOPAZ trial as solidifying Scholar Rock's prospects for regulatory submission for Spinal Muscular Atrophy (SMA) patients aged two and older.
The analyst's updated model also reflects an increased probability of success for apitegromab, which has been adjusted from 65% to 95%. This significant increase in the drug's success probability is a key factor in the revised price target.
In other recent news, Scholar Rock Holding (NASDAQ:SRRK) Corporation has made significant strides in its drug development programs. The biopharmaceutical company reported positive outcomes from the Phase 3 SAPPHIRE trial of its drug apitegromab for treating spinal muscular atrophy (SMA), leading BMO Capital Markets to raise the stock's price target to $38.00.
The firm's analysis indicated an increased probability of the drug's approval, reflected in an updated financial model accounting for a recent capital raise by Scholar Rock.
H.C. Wainwright also increased its price target for Scholar Rock following the positive trial results, maintaining a Buy rating on the stock. The SAPPHIRE trial data demonstrated consistent and clinically meaningful advantages for patients across a wide age range, solidifying base-case revenue projections for the firm.
In other company news, Scholar Rock has announced plans for a public offering aimed at raising $275 million, intending to fund various projects including the commercialization of apitegromab. Additionally, the company appointed Beth Shafer, Ph.D., as Chief Business Officer, responsible for steering the company's long-term corporate and business development strategy.
InvestingPro Insights
Recent data from InvestingPro provides additional context to Scholar Rock's (NASDAQ:SRRK) financial position and market performance. The company's market capitalization stands at $2.58 billion, reflecting investor confidence in its potential. This aligns with Piper Sandler's optimistic outlook on the company's prospects, particularly regarding apitegromab.
InvestingPro Tips highlight that Scholar Rock has seen a strong return over the last month, with a remarkable 232.79% price total return. This surge in stock price correlates with the positive analyst sentiment and the recent successful financing round mentioned in the article. Additionally, the company's liquid assets exceed short-term obligations, suggesting a solid financial foundation to support its drug development efforts.
It's worth noting that InvestingPro Tips also indicate that Scholar Rock is not currently profitable and is not expected to be profitable this year. This is consistent with the company's status as a developing biopharmaceutical firm investing heavily in research and development. The high Price / Book multiple of 19.27 further underscores investor expectations for future growth, likely tied to the potential success of apitegromab.
For investors seeking a more comprehensive analysis, InvestingPro offers 15 additional tips for Scholar Rock, providing a deeper understanding of the company's financial health and market position.
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