Celldex Therapeutics (CLDX) is a clinical-stage biotechnology company that focuses on developing targeted therapies for rare and difficult-to-treat diseases, specializing in immuno-oncology and autoimmune disorders. Positive data from its pipeline candidates - particularly CDX-0159, a drug under development for the treatment of chronic urticaria (hives) and other mast cell-driven diseases - has piqued analysts' interest.
CLDX stock has fallen 27.7% year-to-date, while the S&P 500 Index ($SPX) has risen 22.7%. Nonetheless, Wall Street expects the stock to skyrocket nearly 135% over the next 12 months, based on analysts' average price target.
Celldex Therapeutics’ Progressing Pipeline
One of Celldex's key strengths is its promising pipeline of candidates that address unmet medical needs. Its lead candidate, CDX-0159 (barzolvolimab), is a monoclonal antibody that inhibits KIT receptor signaling, which is important in mast cell-driven disorders. Positive results from clinical trials have fueled optimism, particularly in the treatment of chronic inducible urticaria (CIU) and chronic spontaneous urticaria (CSU), both of which have limited treatment options.
The company is running a global phase 3 trial to determine the efficacy and safety of barzolvolimab in adult patients with CSU after it received positive Phase 2 trial results. In September, the company reported that “Barzolvolimab was well tolerated with a favorable safety profile” in the Phase 2 trial.
A separate Phase 2 trial is currently underway to assess the efficacy and safety of barzolvolimab for eosinophilic esophagitis (EoE). A Phase 2 study to assess CDX-0159's efficacy against prurigo nodularis (PN) has also begun.
Celldex is also developing other oncology, inflammatory, and autoimmune candidates, though they are in the early stages of development. Because the company does not yet have an approved product, its net loss was $35.8 million in Q2.
The company has maintained a healthy cash balance, which should keep it operational until 2027. Its cash, cash equivalents, and marketable securities totaled $802.3 million at the second quarter's end. However, like most biotech companies, future capital raises may be required to advance its pipeline to later stages of development.
Investors should also note that the drug development process is lengthy. Although Celldex has bright prospects, in the long run, it might remain unprofitable until then.
What Does Wall Street Say About Celldex Stock?
Recently, Leerink Partners analyst Thomas Smith reiterated his "buy" rating for Celldex stock, setting a price target of $78. Smith believes, due to Barzolvolimab Phase 2 positive clinical trial results, CLDX “remains the frontrunner in the chronic inducible urticaria market.” Smith also thinks this has given the company a competitive advantage in the market.
Separately, Goldman Sachs analyst Richard Law reiterated a “hold” rating on the stock with a target price of $45, and Citi analyst David Lebowitz initiated coverage of CLDX with a “buy” rating and price target of $70.
Overall, Celldex is a “strong buy” on Wall Street. Out of the 12 analysts in coverage, 10 rate it a “strong buy” and two rate it a “hold.”
The average target price of $67.40 suggests the stock can climb by nearly 135% over the next 12 months. Furthermore, the high target price of $90 implies the stock can rally as much as 213.6% from current levels.
The Bottom Line on Celldex Stock
The company's cash runway has put Celldex in a relatively stable position for the time being. However, the need for additional funding in the future may dilute existing shareholders. Investors should keep an eye out for any potential capital raises or partnership deals that could strengthen the company's financial position while minimizing dilution.
Celldex Therapeutics is a high-risk, high-reward opportunity for investors, particularly those with a strong appetite for speculative biotech plays. The company's innovative pipeline, particularly in chronic urticaria and oncology, puts it in a strong position for future success if clinical trials continue to yield positive results.
On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
