HCW starts Shattuck Labs at buy; PT $28

H.C. Wainwright initiated coverage of Shattuck Labs (NASDAQ:STTK) with a “buy” rating and price target of $28. The stock closed at $3.84 on April 29.

To overcome the shortcomings of current immunomodulatory cancer therapies, Shattuck employs its agonist redirected checkpoint (ARC) platform to discover and develop novel and potent immune enhancing fusion proteins.

Derived from this technology, Shattuck’s two lead assets, SL-172154 and SL-279252, have recently entered the clinic and have made substantial progress towards evaluating each’s antitumor efficacy in numerous solid tumor settings, writes analyst Joseph Pantginis. 

He said both molecules have maintained a favorable safety and pharmacokinetics profile, while demonstrating encouraging preliminary efficacy in Phase 1 studies in heavily pretreated individuals. 

Shattuck went public in October 2020 with an IPO priced at $17 per share that was “generally well-received by the scientific and investor communities,” Mr. Pantginis said. Despite its impressive reception, the stock is currently trading below cash, he added.

“We believe that in the backdrop of a powerful asset discovery platform; two clinical stage assets with accelerating advancement; and improving fundamentals across the company, the stock represents an opportunity to stake out a position during a period that intersects with a favorable moment in the company’s R&D and commercial trajectory. This is significantly bolstered by cash resources (excluding potential business development revenue) into the second half of 2024 during this extremely volatile market,” Mr. Pantginis said.