Global Blood Therapeutics (NASDAQ:GBT) investors got cold feet today, sending shares tumbling nearly 17%. The reason? The biopharmaceutical company presented mixed results from its HOPE-KIDS 1 Phase 2a study in adolescents ages 6 to 17 years with sickle cell disease (SCD) at the European Hematology Association meeting.
Cowen’s top analyst Ritu Baral points out that while hemoglobin (Hb) improvements were in-line with expectations, patient reported outcome (PRO) data failed to impress – likely due to lower baseline values with the full cohort.
Baral wrote, “We remain cautious on the setup into HOPE Part A data, as we continue to believe investor expectations around vaso-occlusive crisis (VOC) remain too high. We suspect today’s pressure on the stock is the result of increased concern on overall success of HOPE, given the PRO is thought to be the ‘backup’ endpoint for Part B. Should VOC – the preferred albeit difficult endpoint all around – disappoint, a path to approvability could well be established on good PRO data. Today’s data is clearly driving new investor doubt on the potential success of the PRO in HOPE Part A. And per our previous note, we remain very cautious into Part A data given what we see as very high VOC expectations, corroborated with the trial’s actual likely statistical powering around the measure, as well as the quantity and detail of data that will actually be released with topline.”
Net net, Baral reiterated an Outperform rating on GBT stock, with a price target of $83, which represents a potential upside of 108% from where the stock is currently trading.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Ritu Baral has a yearly average return of 38% and a 58% success rate. Baral has a 40.7% average return when recommending GBT, and is ranked #27 out of 4832 analysts.
Out of the 11 analysts polled in the past 12 months, 10 rate Global Blood stock a Buy, while 1 rates the stock a Hold. With a return potential of 86%, the stock’s consensus target price stands at $74.22.