In a report released today, Robert Burns from H.C. Wainwright reiterated a Hold rating on Zymeworks (ZYME – Research Report), with a price target of $13.00.
Robert Burns has given his Hold rating due to a combination of factors influencing Zymeworks’ financial and operational outlook. The company reported a wider net loss than anticipated for the fourth quarter of 2024, primarily due to lower-than-expected revenue. Although there were slight variances in R&D and SG&A expenses compared to estimates, the overall financial performance led to a revision in the projected net loss for 2025. Despite these challenges, Zymeworks maintains a strong cash position, which is expected to support operations into the second half of 2027.
Additionally, Burns considers potential upcoming catalysts that could impact Zymeworks’ valuation, such as regulatory decisions and clinical trial results expected in 2025. The valuation of the company is based on a discounted cash flow model, with various probabilities assigned to the approval of its key drug candidates. However, several risks, including clinical trial setbacks, manufacturing challenges, and market competition, contribute to the cautious outlook. These elements collectively support the decision to maintain a Hold rating, reflecting a balanced view of potential opportunities and risks.
In another report released on March 5, Wells Fargo also maintained a Hold rating on the stock with a $14.00 price target.
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