The analysts reiterated an Outperform rating and price target of $20 in a research note, which is more than double the clinical-stage company’s Tuesday close.
Investors disagreed, at least in the short term, sending shares 35% lower to $5.72 in afternoon trading.
The company is part of Phase 3 trial evaluating its Toca 511 and Toca FC treatments in patients with recurrent, high-grade glioma, a type of brain cancer. On Tuesday, the company announced the trial would continue without modification after an interim analysis.
Despite the lack of updates through 75% of the trial, Baird analyst Madhu Kumar wrote that he expects Toca to demonstrate improvements in overall survival in the late stages
“Toca511/FC has a long OS tail beyond the initial 60% of events, suggesting the remaining OS events between today's interim readout and the final 4Q19 readout are likely to provide separation,” Kumar wrote. “In short, the early events were always unlikely to show OS separation in TOCA5, with the final readout likely to drive differences.”
Final results of the trial are expected by the end of the year.
Contact Andrew Kessel at [email protected]
Follow him on Twitter @andrew_kessel