Investing in penny stocks is fraught with risks. Generally marked by inconsistent financials, clouded governance, regulatory hurdles and not-so-transparent reporting, penny stocks are not for the faint-hearted.
However, if you sift through the dirt, you may find diamonds such as Amazon (AMZN) or Nvidia (NVDA) which were once penny stocks. To that end, analysts believe a penny stock from the biotech sector can be one of those winners.
About Cellectis Stock
Founded in 1999 and based in France, Cellectis (CLLS) is a clinical-stage biotechnology company specializing in gene-editing technologies to develop life-saving cell and gene therapies. Cellectis uses its proprietary gene-editing platform, TALEN, to develop off-the-shelf CAR-T cell therapies for cancer treatment. This approach aims to create universal CAR-T cells that can be administered to any patient without donor-patient matching.
Valued at a market capitalization of about $100 million, CLLS stock slid nearly 39% in 2024. So, what is raising bullish sentiment around this stock? Let’s find out.
A Penny Stock With Promising Prospects
Cellectis is advancing its work in engineered, allogeneic cell therapies, focusing on its Universal Chimeric Antigen Receptor T-cell (UCART) platform. This platform creates off-the-shelf CAR-T cell therapies derived from healthy donors, eliminating the need for patient-specific processes. This approach allows for scalability and broader accessibility for patients with malignant cells expressing specific antigens. One key program in development is UCART22, targeting CD22, a marker associated with acute lymphoblastic leukemia. This therapy has received Orphan Drug and Rare Pediatric Disease designations from the FDA, potentially expediting its approval process if trials succeed. Clinical trials are ongoing, with data from 40 patients expected in 2025. Another program is a dual-targeted CAR-T therapy aimed at CD22 and CD20, currently being evaluated in the NATHALI-01 trial, with results also anticipated in 2025.
The company is also enhancing tumor-infiltrating lymphocyte therapies in collaboration with Iovance Biotherapeutics (IOVA) and is working with Primera Therapeutics to develop tools for correcting in vivo mutations in mitochondrial DNA, targeting mitochondrial diseases. These partnerships, along with collaborations with companies like Servier, Allogene Therapeutics (ALLO), and AstraZeneca (AZN), strengthen Cellectis’ position in oncology and gene therapy.
Allogeneic therapies offer several advantages, including healthier donor-derived T cells that are more effective than those from patients undergoing intensive cancer treatments. These therapies are scalable and faster to produce, making them more accessible. With its innovative pipeline, strategic partnerships, and focus on overcoming challenges in cancer treatment, Cellectis is positioned to become a significant player in the global cancer treatment market.
Steady Financials
Cellectis is yet to be consistently profitable. However, an encouraging occurrence in 2024 for the company was its first profitable quarter in three years in the first quarter 2024. Moreover, the results for its latest quarter were marked by rising revenues and narrowing of losses.
Revenue of $18.05 million was a significant jump from the year-ago figure of a mere $1.64 million, and the company reported a loss per share of $0.23, which was narrower than the prior year’s loss of $0.31 per share.
Meanwhile, the company improved its liquidity position this quarter, closing it with a cash balance of about $261 million. This reflected an increase since the start of 2024 and also came in above its short-term lease debt levels of about $8.5 million.
Analyst Opinion on CLLS
Analysts have attributed an overall rating of “Strong Buy” for the stock with a mean target price of $6.50. This denotes upside potential of about 270% from current levels. Out of 6 analysts covering the stock, 5 have a “Strong Buy” rating and 1 has a “Hold” rating.
