TLDR
- Merus (MRUS) receives consensus “Buy” rating from 16 analysts with average price target of $86
- BofA raises price target to $92 from $70 following strong Phase 2 trial results
- Petosemtamab combo therapy achieves 79% survival rate in head and neck cancer patients
- Stock opened at $55.14 with market cap of $3.82 billion and year-to-date high of $61.28
- Recent earnings missed estimates but revenue exceeded expectations at $26.49 million
Merus stock is getting serious attention from Wall Street analysts after the biotech company delivered impressive cancer treatment data. The company now holds a consensus “Buy” rating from 16 analysts covering the stock.
The average price target sits at $86, with individual targets ranging from $75 to $110. HC Wainwright maintains an $85 target while BMO Capital Markets leads the pack at $110.
Strong Trial Results Drive Optimism
The excitement stems from Merus’ Phase 2 trial results for petosemtamab combined with pembrolizumab. The treatment targets first-line head and neck squamous cell carcinoma patients.
The trial hit a 12-month objective survival rate of 79% across the full patient group. This number crushes historical benchmarks for pembrolizumab alone, which typically delivers 50% to 59% survival rates.
BofA analysts were particularly impressed by these results. They had previously indicated that anything in the 50% to 60% range would be considered good data.
The interim data presented at the ASCO Annual Meeting showed even more promise. Among 43 evaluable patients, the treatment achieved a 63% overall response rate.
This included 6 complete responses and 21 partial responses. The median progression-free survival reached 9 months.
Responses occurred across various PD-L1 levels, showing the treatment’s broad potential. At the data cutoff, 14 responding patients remained on treatment.
Stock Performance and Financial Picture
Merus shares opened at $55.14 on Tuesday with a market cap of $3.82 billion. The stock has traded between $33.19 and $61.28 over the past year.
The company’s 50-day moving average sits at $42.88, while the 200-day average is $43.42. The stock carries a beta of 0.94 and trades at a PE ratio of -13.96.
Recent earnings showed mixed results. Merus reported a loss of $1.40 per share, missing consensus estimates of $1.17.
However, revenue came in at $26.49 million, well above the expected $7.82 million. The company maintains a negative return on equity of 38.89% and a negative net margin of 680.61%.
Analysts expect Merus to post -3.85 earnings per share for the current year. Institutional investors own 96.14% of the company’s stock.
Several institutions have increased their positions recently. KBC Group boosted its stake by 4,583.6% in the fourth quarter.
TimesSquare Capital Management increased its holding by 21.6%, now owning 331,195 shares worth $13.927 million. State of New Jersey Common Pension Fund also raised its stake by 29%.
BofA’s price target increase to $92 from $70 reflects growing confidence in the petosemtamab program. The analysts believe the combination therapy could become a best-in-class treatment for head and neck cancer patients.
