In a research report published Wednesday, J.P. Morgan analyst Cory Kasimov reiterated an Overweight rating on shares of Sangamo Biosciences, Inc. (NASDAQ:SGMO) and reduced the price target to $16 (from $22), after the company announced a restructuring of its collaboration agreement with Shire, wherein SGMO is regaining rights to the hemophilia A and B programs, and Shire is retaining rights to the Huntington’s disease program and one other as yet unnamed program.
Kasimov noted, “In our view, this development isn’t entirely surprising given the cadence of the Shire collab so far (over the last year SGMO has reiterated that timing of the programs was uncertain given the strategic developments for Shire over the past year). SGMO underscored the amendment doesn’t reflect on the ZF technology as a whole (or the relative technologies in hemophilia vs. HD programs). On timing, the hemophilia B IND is on track to be submitted before year and, with the hemophilia A IND expected in 2016.”
The analyst continued, “We have increased our expense assumptions going forward going forward now that SGMO will be fully funding this program, have updated for the new royalty/milestone structure, as well as lowered the value we assign to the tech platform. The net effect of our changes is a decrease in the Dec-16 target to $16.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Cory Kasimov has a total average return of -0.2% and a 37.9% success rate. Kasimov has a -31.7% average return when recommending SGMO, and is ranked #2597 out of 3742 analysts.