Goldman Sachs lifts Ideaya Biosciences target to $48 on study results By Investing.com

On Monday, Goldman Sachs updated its outlook on Ideaya Biosciences (NASDAQ:IDYA), increasing the price target to $48 from $47 and maintaining a Buy rating on the stock. The adjustment follows the company’s announcement of interim results from a Phase 2 study of darovasertib (daro) in neoadjuvant uveal melanoma (UM).

Ideaya Biosciences reported that 49% of patients experienced tumor shrinkage of at least 30%. Additionally, 61% of those in the enucleation-evaluable cohort managed to preserve their eye. The company-sponsored portion of the study revealed a low discontinuation rate of 3%, with grade 3 and above, and serious adverse events occurring at rates of 11% and 5%, respectively.

The positive interim results echo the earlier data from the investigator-sponsored trial and initial company-sponsored data. Goldman Sachs anticipates further updates as the trial continues to enroll participants and mature.

Ideaya Biosciences also shared initial FDA guidance on a registrational path for darovasertib, suggesting that randomized trials with eye preservation and time to vision loss as primary endpoints are suitable, without the need for event-free survival as a required secondary endpoint to show statistical significance.

The company expects to enroll approximately 400 patients across two cohorts, estimating around two years to reach the necessary number of events to demonstrate no detriment on event-free survival.

Following these developments, Goldman Sachs has adjusted the expected launch year for darovasertib in neoadjuvant UM from 2028 to 2029 and increased the probability of success from 50% to 60%, reflecting confidence in the drug’s clinical profile and its market potential.

In other recent news, significant developments have been reported from Ideaya Biosciences, a precision oncology company. The company’s Phase 2 trials for darovasertib, a treatment for neoadjuvant uveal melanoma, have shown promising results, including significant tumor shrinkage and eye preservation. This has led to plans for a Phase 3 trial. Several financial firms have adjusted their outlook on Ideaya Biosciences in light of these developments. Stifel, for example, reduced its price target for the company to $66 from $68 but maintained its Buy rating.

On the other hand, BTIG reaffirmed its Buy rating with a steady price target of $62. Furthermore, Goldman Sachs increased its price target for Ideaya Biosciences following the presentation of promising clinical data regarding IDE397.

InvestingPro Insights

Goldman Sachs’ optimistic outlook for Ideaya Biosciences is mirrored by certain financial metrics that highlight the company’s fiscal health and potential challenges. With a substantial market capitalization of $2.83 billion, Ideaya holds more cash than debt on its balance sheet, indicating a solid financial position to support its ongoing clinical trials and potential future developments. This is a key InvestingPro Tip for investors considering the company’s financial stability in the biotech sector.

However, the company’s financial data also reflects the hurdles it faces. Ideaya is trading at a high revenue valuation multiple, which suggests that the market has high expectations for its future sales growth. This is juxtaposed with analysts anticipating a sales decline in the current year and expecting the net income to drop, as per another InvestingPro Tip. The company’s gross profit margin stands at a concerning -1319.69% for the last twelve months as of Q2 2024, underscoring the challenges in achieving profitability. These insights are crucial for investors to weigh Ideaya’s growth prospects against the risks involved.

For those looking to delve deeper, there are 9 additional InvestingPro Tips available, which provide a more comprehensive analysis of Ideaya Biosciences’ financial and market performance. These tips can offer investors a more nuanced view of the company’s potential, beyond the clinical success of its drug candidates.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.