On Monday, Ladenburg Thalmann issued an upgrade for Forte Biosciences Inc. (NASDAQ:FBRX) stock, changing its rating from Neutral to Buy and setting a price target of $2.75. The move reflects a positive outlook on the biotechnology company's future potential.
The analyst at Ladenburg Thalmann cited the leadership of Paul Wagner, PhD, CFA, as a key factor in the upgrade. Wagner, a former Portfolio Manager at Allianz (ETR:ALVG) Global Investors, heads Forte Biosciences, supported by a board of experienced drug developers. This leadership team is considered instrumental in steering the company towards its goals.
Forte Biosciences completed a significant $25 million Private Placement in August 2023. This funding round saw the participation of notable institutional investors such as Perceptive Advisors, Tybourne Capital, BVF Advisors, Fred Alger Management, and Farallon Capital. The capital raised is expected to be a major contributor to the company's financial stability.
The analyst pointed out that with approximately $37 million available at the end of the year, Forte is well-positioned to fund its operations through Phase 1 trials and into the fourth quarter of 2024. This financial runway is crucial for the company's ongoing research and development efforts.
In the statement, the analyst also compared Forte's current valuation to that of Kadmon when it was acquired by Sanofi (EPA:SASY) (NASDAQ:SNY), noting that Forte is trading at eight times less, even when including the cash required to achieve FDA approval. This valuation gap indicates a potential upside for Forte Biosciences' shares.
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