On Monday, H.C. Wainwright adjusted the price target for Oncternal Therapeutics (NASDAQ:ONCT) shares to $28 from the previous target of $30, while maintaining a Buy rating. This revision follows Oncternal's financial results for the fourth quarter of 2023, which showed a net loss of $3.11 per share, an improvement over the analyst's earlier net loss estimate of $3.47 per share.
The narrower loss was primarily attributed to operating expenses that were lower than expected. Research and development (R&D) costs for the quarter were reported at $6.7 million, compared to the projected $7.7 million. Similarly, selling, general, and administrative (SG&A) expenses came in at $3.3 million, slightly above the forecast of $3.2 million.
Looking ahead, H.C. Wainwright has set a new projection for Oncternal's full-year 2024 net loss at $14.04 per share, which is a slight improvement from the prior estimate of $14.27 per share. The company concluded the year 2023 with approximately $34.3 million in cash, cash equivalents, and marketable securities.
According to the guidance provided by Oncternal's management, the current financial reserves are expected to fund operations into 2025. Despite the adjustment in the price target, H.C. Wainwright reaffirms the Buy rating, taking into account the anticipated higher operating expenses in the future.
InvestingPro Insights
Following the recent financial results and price target adjustment for Oncternal Therapeutics (NASDAQ:ONCT), a deeper dive into the company's performance using InvestingPro data reveals several key metrics. With a market cap of $25.28 million and a substantial price uptick of 52.54% over the last six months, Oncternal's financial position is a mix of strengths and concerns. The company holds more cash than debt, which is reflected in their liquid assets exceeding short-term obligations, aligning with the management's statement about funding operations into 2025. This financial stability is crucial for investors considering the company's lack of profitability over the last twelve months and the analysts' expectation of a sales decline in the current year.
InvestingPro Tips highlight that Oncternal does not pay a dividend and suffers from weak gross profit margins, with a staggering gross profit margin of -3690.19% for the last twelve months as of Q4 2023. Furthermore, the company's P/E ratio stands at -0.63, indicating that investors are anticipating future growth despite current earnings not justifying the stock price. These insights, coupled with the fact that analysts do not anticipate the company will be profitable this year, suggest a cautious approach for potential investors.
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