BofA Securities Initiates Editas Medicine with Neutral Rating
October 4, 2022
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BofA Securities has given Editas Medicine ($NASDAQ:EDIT) a neutral rating with an $18 price target. The company’s hemoglobinopathies gene editing candidates have tough competition, but the company’s technology is promising. Editas Medicine’s technology may give it an edge in the market, and BofA Securities is bullish on the company’s prospects.
Share Price
On Thursday, Editas Medicine stock opened at $13.0 and closed at $12.2, dropping by 9.3% from the prior closing price of $13.4. BofA Securities has given Editas a “neutral” rating, citing the company’s strong pipeline and partnerships as key positives, but also noting the significant risk and uncertainty associated with clinical-stage biotech companies.
VI Analysis
A company’s fundamentals reflect its long term potential. The below analysis on Editas Medicine is made simple by VI app. Based on VI Star Chart, Editas Medicine is strong in asset, growth, and weak in dividend, profitability. Editas Medicine has an intermediate health score of 5/10 considering its cashflows and debt, which might be able to sustain future operations in times of crisis.
Editas Medicine is classified as ‘elephant’, a type of company that is rich in assets after deducting off liabilities. Such company is deemed less risky as the intrinsic value is pegged to its assets.
Summary
However, the company faces significant competition, execution risks, and a large valuation. The stock price moved down on the same day, as the market reacted negatively to the BofA Securities initiation. Many investors may be worried about the company’s competition, execution risks, and large valuation. However, the company’s leading position in the CRISPR/Cas9 gene-editing field and potential near-term catalysts may be enough to attract some investors.
