Piper Sandler analyst Edward Tenthoff raised the firm’s price target on Sutro Biopharma (STRO) to $16 from $14 and reiterates an Overweight rating on the shares. The stock in afternoon trading is up 17% to $5.06. The company partnered with Astellas to develop three novel immunostimulatory antibody-drug conjugates and will receive $90M upfront, up to $1.27B in milestones, and retain a U.S. profit share option plus global royalties, Tenthoff tells investors in a research note. The analyst says Sutro has “strong partnerships and is developing a rich preclinical pipeline.” In addition, Merck’s (MRK) potential acquisition of Seagen (SGEN) validates ADCs and “creates scarcity value,” writes Tenthoff.
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