tiprankstipranks
Stoke Therapeutics Stock: Strong Rebound Potential
Stock Analysis & Ideas

Stoke Therapeutics Stock: Strong Rebound Potential

Shares of Stoke Therapeutics (STOK) have struggled over the past 12 months, sinking by 40.8%.

Year-to-date, shares are down 60.7%.

However, this stock still possesses qualities that instill optimism. These, of course, have to show up somehow, and then wait for the market’s verdict. Thus, I am bullish on this stock. (See Analysts’ Top Stocks on TipRanks)

Based in Bedford, Massachusetts, this early-stage biopharmaceutical company is developing an RNA-based therapy for Dravet syndrome, and the autosomal dominant optic atrophy (ADOA).

The first is a severe and progressive form of genetic epilepsy, while the second is the most frequent optic nerve disorder amid hereditary diseases.

Lately, the expression “RNA (Ribonucleic Acid)-based therapies” has become very popular due to the vaccine against COVID-19. In reality, pharmacological strategies have been using this biological molecule in various fields of medicine for years.

RNA is an essential actor in handling our genetic heritage, as, through a process called protein synthesis, it translates the genetic information on genes into proteins.

Q2 Earnings

The company is not selling any treatment yet, so it has not earned revenues in the second quarter of 2021.

In addition to disbursements for the personnel, Stoke Therapeutics had to cover other expenses that it sustained because of the development of its candidate therapy, called STK-001, addressing Dravet syndrome.

These were higher on a year-over-year basis, so the net loss that Stoke Therapeutics incurred the year before got worse, growing more than 69% to $22 million, or $0.39 per common share.

Almost $252 million was the total amount of funds available in cash on hand and marketable securities at the end of the quarter. The company judges this endowment as sufficient to fund operating activities for at least another year.

Catalysts

In a clinical trial, Dravet syndrome U.S. patients were given a specific dosage of STK-001. The results were positive, but they got only partial disclosure last September. The most interesting ones, regarding the administration of the company’s lead candidate in multiple ascending doses, will be revealed in 2022.

This year, STK-100 starts its testing on people in the United Kingdom.

The company should then get more insights into its potential treatment, and plan the next development steps.

Wall Street’s Take

In the past three months, four Wall Street analysts have issued a 12-month price target for STOK.

The average Stoke Therapeutics price target is $70, implying a 206.5% upside. The analyst rating consensus is a Strong Buy rating, based on four Buy ratings.

Summary

The stock has underperformed the market heavily this year.

There is huge potential in important updates just around the corner, though. This could translate into a significant rebound, but the market has to do its part.

Disclosure: At the time of publication, Alberto Abaterusso did not have a position in any of the securities mentioned in this article.

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.


Trending

Name
Price
Price Change
S&P 500
Dow Jones
Nasdaq 100
Bitcoin

Popular Articles