Why Did Cantor Fitzgerald Downgrade Adverum Biotechnologies’ Stock?

By Jason Carr

Cantor Fitzgerald analyst Charles Duncan downgraded Adverum Biotechnologies (ADVM) to Hold yesterday and set a price target of $4. The company’s shares closed on Friday at $3.34, close to its 52-week low of $2.62.

Duncan observed:

“. We are downgrading and reducing our 12-month PT to $4 from $12. The new PT is solely based on the ADVM-022 wAMD program, soon to enter P1 testing in 2018. Our changed perspective results from the PR Friday that the company discontinued development of lead asset ADVM-043 for treatment of A1AT deficiency and hit pause on the preclinical HAE program, deciding not to file an IND in 4Q18. Although further clarity on rare disease programs is expected in 1H19, we now see only the wAMD program as a potential driver of value over the next ~12-18 months.”

According to TipRanks.com, Duncan is a 3-star analyst with an average return of 0.9% and a 45.0% success rate. Duncan covers the Healthcare sector, focusing on stocks such as Biohaven Pharmaceutical Holding Co Ltd, KalVista Pharmaceuticals Inc, and ACADIA Pharmaceuticals Inc.

The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Adverum Biotechnologies with a $6.13 average price target, representing an 83.5% upside. In a report issued on November 2, Raymond James also downgraded the stock to Hold.

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Based on Adverum Biotechnologies’ latest earnings release for the quarter ending June 30, the company reported a quarterly GAAP net loss of $18.81 million. In comparison, last year the company had a GAAP net loss of $13.83 million.

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Adverum Biotechnologies, Inc. is a clinical-stage biotechnology company that engages in the development of novel gene therapies to treat patients with sight-threatening ophthalmic diseases. It focuses on treatment of wet age-related macular degeneration, alpha-1 antitrypsin deficiency, hereditary angioedema, friedreich’s ataxia, severe allergy, color vision deficiency, and juvenile x-linked retinoschisis. The company was founded by Mark S. Blumenkranz, Thomas W. Chalberg, Jr. and Steven Daniel Schwartz on July 17, 2006 and is headquartered in Menlo Park, CA.