Why BofA Turned Bullish On Checkmate Pharmaceuticals, But Slashed Price Target

Given the early clinical data on Checkmate Pharmaceuticals Inc’s CMPI vidutolimod, key opinion leaders remain “positively biased on its outlook,” according to BofA Securities.

The Checkmate Pharmaceuticals Analyst: Jason Zemansky upgraded Checkmate Pharmaceuticals from Neutral to Buy and lowered the price target from $19 to $7.

The Checkmate Pharmaceuticals Takeaways: It’s not yet time to give up on vidutolimod despite the numerous historical failures of this class of candidates, Zemansky said in an upgrade note.

The feedback from key opinion leaders was “more positive than negative, with comments echoing our initial assessment of the tilsotolimod data- i.e., there are many reasons to remain optimistic about Checkmate’s TLR9 agonist given a number of differentiating characteristics and key differences between the melanoma trial designs,” the analyst said. 

The stock is “now trading below cash” and the selloff appears overdone “in light of vidutolimod’s encouraging preliminary data and the compelling market opportunities if successful (even given our more conservative assumptions),” he said. 

CMPI Price Action: Shares of Checkmate Pharmaceuticals were rallying by 11.4% to $4.30 Wednesday afternoon.