Jonathan Wolleben, an analyst from JMP Securities, reiterated the Buy rating on Allakos (ALLK – Research Report). The associated price target is $10.00.
Jonathan Wolleben has given his Buy rating due to a combination of factors, particularly the anticipated reporting of Phase 2 data for Allakos’s drug lirentelimab, which is expected to be a significant catalyst for the company’s stock. The analyst expresses greater confidence in the drug’s potential for treating chronic spontaneous urticaria (CSU) as compared to atopic dermatitis (AD), based on the clinical data available. The success in either of these trials could substantially increase ALLK shares, given the drug’s blockbuster potential. Furthermore, lirentelimab’s unique anti-siglec-8 monoclonal antibody mechanism and its well-documented safety profile could set it apart in a market where safety concerns are prevalent, especially for CSU treatments.
Wolleben also highlights the underappreciated value of Allakos’s stock, noting that it’s trading below its cash value, which presents an attractive risk/reward ratio leading up to the data release. The potential for lirentelimab to close the valuation gap with its competitors, especially if it shows efficacy comparable to the currently approved drug for CSU, Xolair, is seen as another reason for the Buy rating. Additionally, low investor expectations for the AD trial outcomes mean any positive data could provide a significant upside surprise. Overall, the anticipation for the forthcoming clinical results and the potential market impact of lirentelimab underpin Wolleben’s optimistic view of Allakos’s stock.
Wolleben covers the Healthcare sector, focusing on stocks such as Mirum Pharmaceuticals, Ocular Therapeutix, and Altimmune. According to TipRanks, Wolleben has an average return of -8.1% and a 30.39% success rate on recommended stocks.
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Allakos (ALLK) Company Description:
Allakos, Inc. engages in the development of therapeutic antibodies. Its primary product is AK002, a monoclonal antibody used for the treatment of various eosinophil and mast cell related diseases such as eosinophilic gastritis, urticaria, severe allergic conjunctivitis, and indolent systemic mastocytosis. The company was founded by Christopher Bebbington, Nenad Tomasevic, Bruce S. Bochner, and Robert Schleimer in 2012 and is headquartered in Redwood, CA.
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