BTIG maintains $98 target on Vaxcyte with positive outlook By Investing.com

On Wednesday, BTIG reiterated a Buy rating and a $98.00 price target for Vaxcyte (NASDAQ:PCVX), expressing confidence in the company’s ongoing VAX-31 trial. The firm anticipates low risk of failure in achieving immunogenicity for more than 24 serotypes, despite the smaller trial size and potential for variability.

The trial’s focus is on the immunogenicity of each antigen, with a successful outcome defined by clear non-zero immunogenicity. The analyst pointed out that even with a 95% probability of success for each antigen, the likelihood of hitting all 31 remains around 20%. Nevertheless, the results from the phase 2 trial suggest the platform’s capability to produce a strong immune response, especially for seven serotypes that showed higher Geometric Mean Ratios (GMRs) at increased doses.

Vaxcyte’s phase 2 trial revealed that some serotypes did not maintain non-inferiority levels when the dosage was increased, notably serotypes 1 and 22F. However, it is believed that these discrepancies were due to larger error margins in the smaller phase 2 trial, and only serotype 5 might pose a risk in a larger phase 3 study. The analyst also highlighted that serotype 5, known for its low immunogenicity in most pneumococcal conjugate vaccine (PCV) trials, has been excluded from a competitor’s vaccine, indicating no direct competition for Vaxcyte in this area.

The company has updated its timelines, with the next significant step being a smaller phase 3 trial employing commercial-grade material. This upcoming trial will produce 31 independent batches to be combined into a final preparation for either VAX-31 or VAX-24, depending on the study’s direction. The preparation for this trial is currently underway, marking a critical phase in Vaxcyte’s progress towards commercializing its vaccine platform.

In other recent news, Vaxcyte has announced the appointment of John P. Furey to its Board of Directors. Furey, who is set to serve until the 2025 annual stockholders meeting, will also join the Compensation Committee of the Board. His appointment is in line with the Nasdaq listing standards, and Vaxcyte has confirmed that there are no undisclosed personal or financial conflicts of interest. As part of his compensation, Furey received a nonstatutory stock option grant valued at $800,000 and will receive an annual equity award worth $450,000.

In addition to Vaxcyte’s board changes, Cathie Wood’s ARK ETF has made significant transactions in several sectors. Notably, ARK purchased 77,959 shares of PagerDuty (NYSE:) Inc and added 17,615 shares of Roblox Corp to its portfolio. On the other hand, the fund sold shares in Teladoc (NYSE:) Health Inc and Verve Therapeutics Inc, indicating a shift in its investment strategy. These are the recent developments in the business world.

InvestingPro Insights

As Vaxcyte (NASDAQ:PCVX) continues to advance its VAX-31 trial, insights from InvestingPro provide a financial perspective on the company’s current standing. With a market capitalization of $7.93 billion, Vaxcyte holds a significant position in the biotech sector. Despite the lack of profitability in the last twelve months, as indicated by a negative P/E ratio of -16.03, the company has shown a strong return over the last year, with a 53.48% price total return, reflecting investor optimism in its future prospects.

An important highlight from the InvestingPro Tips is that Vaxcyte’s liquid assets exceed its short-term obligations, suggesting financial resilience in the near term. However, the company faces challenges with weak gross profit margins, which could impact its long-term financial health. Analysts are not expecting the company to turn profitable this year, but Vaxcyte’s balance sheet strength, with more cash than debt, provides some cushion against these headwinds.

For those seeking more in-depth analysis, InvestingPro offers additional tips on Vaxcyte’s financial health and future prospects. There are seven more InvestingPro Tips available, which could provide valuable insights for investors considering this biotech player.

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