Little known biotech Aim ImmunoTech (AIM) has soared by a massive 382% year-to-date. Yet, Maxim’s analyst Jason McCarthy argues the $75 million market cap still doesn’t capture its potential value. So, why does the analyst believe AIM is undervalued?
For starters, the company’s flagship product Ampligen, a pluripotent toll like receptor 3 (TLR3) agonist, has shown promise across a number of indications and is getting the appropriate backing.
The company recently announced it has been awarded $14.54 million from the National Cancer Institute to study Ampligen in 5 oncology clinical trials. Secondly, the drug is already approved in Argentina for the treatment of patients with chronic fatigue syndrome.
But as an innate immune response stimulator, Ampligen’s potential is wider reaching. The drug has shown potential in SARS and MERS in previous studies, and has demonstrated 100% protective efficacy against SARS-CoV-1 in animal models. This implies it could be successful in generating immunity against COVID-19.
As McCarthy explained, “From a COVID-19 perspective, the rapid induction of symptomatic patients with fever, cough etc. to pneumonia requiring intubation for a ventilator is reportedly very rapid. Innate immunity is germ-line (exists from birth) and reacts essentially instantly, whereas adaptive immunity takes weeks to develop and is ‘learned’ by the immune system. As such, inducing the innate, front-line response in the immune system, is critical and where a drug like Ampligen could be useful.”
With a strengthened balance sheet following the raising of capital through ATM offerings, and Ampligen’s promise in multiple indications, McCarthy needs no more convincing.
The analyst reiterated a Buy on AIM and raised the price target, from $2.00 to $5.00, which implies nearly 100% upside from current levels. (To watch McCarthy’s track record, click here)
Only one other analyst has published a review of AIM over the last 3 months. The additional Buy rating means AIM receives a Moderate Buy consensus rating. At $4.00, the average price target implies potential upside of 57%. (See AIM’s stock analysis on TipRanks)