ALX Oncology downgraded to Hold from Buy at Stifel

Stifel analyst Bradley Canino downgraded ALX Oncology to Hold from Buy with a price target of $14, up from $10. The firm thinks ALX’s CD47 blocker evorpacept is fully valued for the de-risked HER2+ gastric cancer development opportunity and it would “be more optimistic” if it thought this was more than a sub-$100M market, the analyst tells investors. While the firm recognizes that its downgrade comes “immediately before a period where the stock enters a string of successive early-stage data catalysts” where the “optionality” of CD47 will be tested, Stifel either sees insufficient evidence to support the potential for positive data or fails to see tractable development paths as a combination backbone, the analyst added.