Gilead Updates "Bode Well for SL-172154 " - H.C. Wainwright Reiterates Buy Rating, $28 Price Target on Shattuck Labs (STTK)

H.C. Wainwright analyst Joseph Pantginis reiterated a Buy rating and $28.00 price target on Shattuck Labs (NASDAQ: STTK), following a recent ASCO presentation by Gilead - Shattuck's competitor in MDS and AML space.

The analyst comments: "At ASCO, Gilead provided announced Phase 1b study results for the use of magrolimab (a monoclonal against CD47) in combination with azacitidine (AZA) for the treatment of myelodysplastic syndrome (MDS) and acute myeloid leukemia (AML). We remind investors that the CD47/SIRPα signaling axis is a key macrophage checkpoint with two druggable targets (CD47 on macrophages and SIRPα on tumor cells). Recall that Shattuck is also developing an anti-cancer therapeutic targeting one of these receptors, SIRPα, as part of its SIRPα-Fc-CD40L (SL-172154) bispecific fusion protein that is both a SIRPα inhibitor and CD40 agonist.

We reiterate our Buy rating and $28 price target. Our valuation is based on our clinical net present value (NPV) model, which allows us to flex multiple assumptions affecting a drug's profile. We currently value Shattuck on the first three clinical opportunities for SL-172154, each with a 15% probability of success: (1) ovarian - 48% contribution; (2) AML - 40% contribution; and (3) MDS - 12% contribution. We project Shattuck maintaining U.S. rights for SL-172154, and an ex-U.S. partnership with a 20% royalty in the future. Moving forward, we believe significant upside potential exists based on: (1) advancement through clinical development and adapting our underlying assumptions; (2) inclusion of SL-279252 into our projections (already in the clinic); and (3) pipeline development and expansion to other indications with currently no value contribution to our projections. Factors that could impede reaching our PT include failed or inconclusive clinical trials, the inability of the company to secure adequate funding to progress its drugs through the development pathway or the occurrence of dilutive capital raises."

For an analyst ratings summary and ratings history on Shattuck Labs click here. For more ratings news on Shattuck Labs click here.

Shares of Shattuck Labs closed at $3.23 yesterday.

By Vlad Schepkov

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