Inovio (INO) has had an up-and-down month. Shares shot up nearly 70% by January 27, before slipping 25% in the subsequent two days. In one word: roller-coaster.
The surge for the infectious disease fighter follows news that a grant of up to $9 million from the Coalition for Epidemic Preparedness Innovations (CEPI) has been awarded to the company for the development of a vaccine against 2019-nCoV, the strain of the virus spreading in China. The grant will go towards preclinical work for INO-4800, Inovio’s new vaccine matched to the outbreak strain, and followed by a phase 1 clinical trial for the drug.
With fears of an international outbreak of the coronavirus currently gripping countries all over the world, healthcare companies are up and running in search of a solution. So far, the virus has claimed over 100 lives in China, the majority in the city of Wuhan, and sickened thousands more.
Piper Sandler’s Christopher Raymond notes that the grant “underscores the importance of Inovio’s science in the global effort to counter pandemics”. The 5-star analyst also stresses, though, that an approval and commercial order is “likely years out.” Raymond added, “Having seen this movie play out before with other pandemics, we think it’s prudent to take a step back to understand the impact.” The 5-star analyst reiterated his Overweight rating on Ivovio shares, along with his $8 price target, implying upside potential of 96%. (To watch Raymond’s track record, click here)
Maxim’s Jason McCarthy also notes Inovio’s suitability for developing the vaccine. The analyst said, “More details are emerging, but the positive news is that since they are similar to SARS and MERS (same family) and much research has been done, there is a breadth of knowledge from which companies like Inovio can start/continue developing a potential vaccine.” The analyst kept his Buy rating on Inovio, along with a $6 price target. The figure indicates upside potential of 47% from current levels. (To watch McCarthy’s track record, click here)
All in all, Inovio is getting a lot of love from the Street at present. A unanimous 7 Buys coalesce into a Strong Buy consensus rating. Should the average price target ($9.43) be met, investors could be taking home gains in the shape of ~132% over the next 12 months. (See Inovio stock analysis on TipRanks)