Inovio Stock Cut to Hold at Stifel on Valuation, Fundamentals

Inovio shares on Friday fell after Stifel cut the biotech to hold, citing valuation and fundamentals.
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Inovio Pharmaceuticals  (INO) - Get Report shares on Friday fell after Stifel analyst Stephen Willey downgraded the biotech company to hold from buy.

He acted on valuation and fundamental concerns. Inovio shares in 2020 through Thursday rose by a factor of more than eight, with the surge stemming from enthusiasm about the Plymouth Meeting, Pa., company's coronavirus vaccine candidate.

“Risk/reward seems less palatable here,” Willey wrote in a commentary cited by Bloomberg. 

To be sure, there is a “significant socioeconomic importance of a viable covid-19 vaccine candidate,” he acknowledged.

Results from Inovio’s patient test for its vaccine candidate, INO-4800, are due by June 30, Bloomberg reports.

Willey isn’t too worried about the vaccine’s safety, and he expects initial immunogenicity results to be “directionally encouraging.” But competition with Moderna’s  (MRNA) - Get Report vaccine is an issue, he said.

Inovio’s ability to scale up production of a potential vaccine also is a question mark, Willey said. It’s in the midst of a legal dispute with the main manufacturer of the vaccine, South Korea-based GeneOne Life Science, Bloomberg reports.

Willey lifted his share-price target for Inovio to $24 from $19, reflecting recent market activity.

Cantor Fitzgerald analyst Charles Duncan more than doublef his price target on Friday - to $45 from $17 - and maintained his overweight rating.

As for Moderna, it and Catalent  (CTLT) - Get Report on Thursday unveiled a joint effort to release Moderna's coronavirus-vaccine candidate this quarter.

Drug-delivery specialist Catalent will provide vial-filling and packaging services for drug maker Moderna’s coronavirus vaccine candidate mRNA-1273, the companies said.

Inovio’s shares recently traded at $27.50, down 12%. The stock has quadrupled in the past three months, including Friday’s drop.