On Tuesday, JMP Securities initiated coverage on Inhibrx Inc. (NASDAQ:INBX) stock with a Market Perform rating.
The firm’s initiation follows the acquisition of INBRX-101 by pharmaceutical giant Sanofi (NASDAQ:) and the subsequent creation of a new entity, Inhibrx Biosciences. Sanofi completed the purchase of INBRX-101, a treatment for alpha-1 antitrypsin deficiency (AATD), with the transaction valued at approximately $2.2 billion.
Post-acquisition, Inhibrx Biosciences was established with a strong financial foundation, having $255.4 million in proforma cash, which includes an 8% equity investment from Sanofi.
This strategic move has positioned the newly formed company to focus on advancing its remaining assets, particularly its drug candidates ozekibart (INBRX-109) and INBRX-106.
Ozekibart, a tetravalent DR5 agonist, and INBRX-106, a hexavalent OR40 agonist, are at the forefront of Inhibrx’s development pipeline. JMP Securities highlighted the company’s solid capitalization, which is anticipated to support the progression of these drug candidates towards significant clinical readouts expected in the third quarter of 2025.
The analyst’s remarks underscore the transition that Inhibrx has undergone following the deal with Sanofi, which has not only infused substantial capital but also streamlined the company’s focus on its leading therapeutic candidates.
The Market Perform rating indicates a neutral outlook on the company’s stock, as Inhibrx Biosciences embarks on its development journey with a reinforced balance sheet and a narrowed scope of research and development activities.
InvestingPro Insights
In the wake of JMP Securities’ initiation of coverage on Inhibrx Inc. (NASDAQ:INBX), the current financial health and market perception of the company are of keen interest to investors. According to the latest InvestingPro data, Inhibrx has a market capitalization of $195.28 million and is trading at a previous close price of $13.49. Despite the strategic acquisition by Sanofi, Inhibrx’s financial metrics show a challenging picture, with a negative adjusted P/E ratio for the last twelve months as of Q1 2024 standing at -1.19, and a strikingly high negative gross profit margin at -8245.04%. This suggests that the company is facing significant pressures that are affecting its profitability.
InvestingPro Tips indicate that Inhibrx is rapidly depleting cash and suffers from weak gross profit margins, which may raise concerns about the company’s financial sustainability. Additionally, with short-term obligations exceeding liquid assets and a valuation that implies a poor free cash flow yield, investors may need to exercise caution. The company is also noted for operating with a moderate level of debt and not being profitable over the last twelve months, which could be areas of focus for those considering the stock. Moreover, Inhibrx does not pay a dividend, which may deter income-focused investors.
For those looking to delve deeper into the financials and future prospects of Inhibrx, InvestingPro offers additional insights and tips. There are 7 more InvestingPro Tips available that can provide a comprehensive view of the company’s financial health and market potential. To access these tips and make informed investment decisions, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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