UPDATE: Citi Upgrades Zymeworks (ZYME) to Buy, 'Better Risk/Reward Has Emerged'
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Citi analyst Yigal Nochomovitz upgraded Zymeworks (NYSE: ZYME) from Neutral to Buy with a price target of $53.00.
The analyst comments "The direction of the market’s reaction to the ZW49 update does not come as a huge surprise as we had previously expressed caution that in view of the limited data (just 6 evaluable patients in the top two dose cohorts in the Q3W schedule) interpreting the ORR vs. competing therapies (Enhertu, Pfizer’s HER2 ADC PF-06804103) would likely be challenging. That being said, despite a somewhat confusing and even at times contentious Q&A session, we do not believe that the probability of success for ZW49 should be lowered from our current 60% assumption because safety looks very favorable at the go-forward expansion dose (Q3W 2.5mg/kg) and we simply don’t have enough information to properly evaluate efficacy. Therefore, given the stock is now trading at ~$33 in the post-market, we are upgrading ZYME to Buy and retaining our $53 price target in view of a more favorable risk/reward profile."
Shares of Zymeworks closed at $44.06 yesterday.
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