Buy Rating Affirmed for Terns Pharmaceuticals Amid Robust Financials and Promising Pipeline Prospects

Analyst Etzer Darout of BMO Capital reiterated a Buy rating on Terns Pharmaceuticals (TERN – Research Report), retaining the price target of $19.00.

Etzer Darout has given his Buy rating due to a combination of factors including Terns Pharmaceuticals’ robust financial position and the promising outlook for its lead programs. Specifically, the company reported a substantial cash reserve that is expected to sustain operations until 2026. This financial stability is critical for the company’s ability to continue developing its pipeline. Furthermore, Darout’s optimism is fueled by the anticipation of significant data readouts in the second half of the year for TERN-701 and TERN-601, which are poised to address unmet needs in chronic myeloid leukemia (CML) and obesity, respectively. Both represent sizable market opportunities and the potential for these treatments to offer improved convenience and tolerability compared to existing options enhances their commercial prospects.

In addition to the lead programs, the analyst’s confidence is underpinned by the progress in Terns Pharmaceuticals’ early pipeline, including advancements made with the TERN-800 series. The company’s strategic prioritization in nominating a developmental candidate for this series reflects its commitment to exploring combination therapies that could offer additional metabolic and liver benefits. Etzer Darout’s report further emphasizes the potential of TERN’s small molecule platform to deliver clinically validated, differentiated assets in multiple therapeutic areas. This platform, coupled with the expected de-risking data across its pipeline, is seen as a strong catalyst for substantial upside to Terns Pharmaceuticals’ shares within the next 12-18 months.

TERN’s price has also changed dramatically for the past six months – from $3.370 to $5.890, which is a 74.78% increase.

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Terns Pharmaceuticals (TERN) Company Description:

Terns Pharmaceuticals Inc is a clinical-stage biopharmaceutical company. It is developing a portfolio of small-molecule single-agent and combination therapy candidates for the treatment of non-alcoholic steatohepatitis, or NASH, and other chronic liver diseases.