BofA cuts Keros target to $33, says ‘story still intact’ despite ‘setback’

BofA lowered the firm’s price target on Keros Therapeutics (KROS) to $33 from $77 and keeps a Buy rating on the shares after the company announced that it was voluntarily halting the two higher-dosing arms of TROPOS, a phase 2 study of cibotercept in pulmonary arterial hypertension, due to the emergence of pericardial effusion side effects. While the news is “a major setback for the program, which had arguably become the driver of the narrative,” the firm still sees “reasons to like the story” while admitting that a cautious outlook on cibotercept “looks warranted.” After largely removing cibotercept from its model and lowering its price target accordingly, the firm says its revised target still offers “solid upside potential from current levels.”