H.C. Wainwright analyst Arthur He CFA downgraded the rating on LAVA Therapeutics (LVTX – Research Report) to a Hold today, setting a price target of $1.50.
Arthur He CFA has given his Hold rating due to a combination of factors surrounding LAVA Therapeutics. The company recently announced a significant workforce reduction and a strategic review aimed at extending its cash reserves and maximizing shareholder value. This decision, while understandable given the current market conditions, introduces uncertainty regarding LAVA’s sole clinical asset, LAVA-1266, which is under development for hematological malignancies. The outcome of the strategic review could significantly impact the prioritization of LAVA-1266, especially if the company decides to pursue new strategic directions such as acquisitions or mergers.
Given these uncertainties, Arthur He CFA has decided to adopt a cautious stance, downgrading the stock from Buy to Neutral. The company has a substantial cash reserve projected to last until 2027, with an estimated cash value of $1.46 per share by the end of 2025, rounded to a price target of $1.50. While LAVA-1266 holds potential upside, its future depends heavily on the strategic decisions made in the coming months. Therefore, it is prudent to wait for more clarity on the company’s direction before making further projections.
In another report released yesterday, Citi also downgraded the stock to a Hold with a $1.50 price target.