Is Infinity about to take a great leap forward?
Roller Coaster Ride
Infinity Pharmaceuticals, Inc., a clinical-stage biotechnology company, is developing eganelisib (IPI-549), a potentially first-in-class, oral, immuno-oncology macrophage reprogramming therapeutic. The drug candidate is designed to address a fundamental biologic mechanism of immune suppression in cancer in multiple clinical studies.
MARIO-275 is a randomized, controlled combination study of eganelisib combined with Opdivo® in I/O naïve urothelial cancer. MARIO-3 is the first eganelisib combination study in front-line advanced cancer patients and is evaluating eganelisib in combination with Tecentriq® and Abraxane® in front-line TNBC and in combination with Tecentriq and Avastin® in front-line RCC.
In collaboration with Arcus Biosciences, Infinity is evaluating a checkpoint inhibitor-free, novel combination regimen of eganelisib plus etrumadenant (AB928, a dual adenosine receptor antagonist) plus Doxil® in advanced TNBC patients. In 2019, Infinity completed enrollment in MARIO-1, a Phase 1/1b study evaluating eganelisib as a monotherapy and in combination with Opdivo (nivolumab) in patients with advanced solid tumors including patients refractory to checkpoint inhibitor therapy. With these studies Infinity is evaluating eganelisib in the anti-PD-1 refractory, I/O-naïve and front-line settings.
Infinity stock has been volatile with big swings in both directions. Earlier this year, the market’s reaction to Infinity stock was downbeat because of disappointing results from a breast cancer study. Wall Street analysts got excited by the results of phase 2 urothelial cancer tests, which showed the drug increased the survival rate of participants, indicating that eganelisib has potential as a possible therapy.
J.P. Morgan’s Anupam Rama certainly believes that the “totality of the eganelisib in 2L urothelial cancer is being underappreciated at current levels.” At the beginning of August Rama upgraded the stock’s rating from neutral (hold) to overweight (buy) and put a $6 price target on the stock. Rama joins other Wall Street analysts in calling this stock one to watch after Infinity announced clinical updates of its lead candidate eganelisib – currently in combination-based programs in urothelial cancer and triple negative breast cancer (TNBC).
According to Rama, “These data underscore the strong ORR / DCR / PFS trends observed at ASCO GU in February, particularly in PD-L1 low patients, and helps de-risk a potential phase 3 study in the population (status / timelines of registrational enabling study timelines anticipate by YE21). From a modeling perspective, we currently only include PD-L1 low UC patients, given the totality of the data, and estimate WW peak sales in the ~$500-600M range.” Based on the potential of eganelisib in UC alone, Rama thinks the shares are “undervalued” and sees any extra “indication shots on goal as potential longer-term value drivers.”
Isaac Mitchell of Marketing Sentinel said that during the last session, Infinity’s traded shares were 1.98 million, with the beta value of the company hitting 2.21. At the end of the day, the stock’s price was $3.71, showing an intraday gain of 2.20% or $0.08. He added, “The 52-week high for the INFI share is $5.98; that puts it down -61.19 from that peak though still a striking 73.05% gain since the share price plummeted to a 52-week low of $1.00. The company’s market capitalization is $310.08M, and the average intraday trading volume over the past 10 days was 1.85 million shares, and the average trade volume was 7.51 million shares over the past three months.”
According to Mitchell, the company got a consensus recommendation of a buy from analysts. As he explained, “That translates to a mean rating of 1.90. INFI has a Sell rating from 0 analyst(s) out of 7 analysts who have looked at this stock. 0 analyst(s) recommend to Hold the stock while 0 suggest Overweight, and 7 recommend a Buy rating for it. 0 analyst(s) has rated the stock Underweight. Company’s earnings per share (EPS) for the current quarter are expected to be -$0.13.”
As of September 24, the consensus price target of analysts on Wall Street was $9.29, which implies an increase of 60.06% to the stock’s current value. The extremes of the forecast give a target low and a target high price of $4.00 and $14.00 respectively. As a result, INFI is trading at a discount of -277.36% off the target high and -7.82% off the low.
Statistics show that Infinity has underperformed its competitors in share price, compared to the industry in which it operates. Infinity Pharmaceuticals Inc. (INFI) shares have gone up 10.42% during the last six months, with a year-to-date growth rate less than the industry average at 17.65% against 17.80. Yet analysts are ramping up their growth forecast for the fiscal year 2021. Revenue is predicted to grow 18.80% this quarter and then jump 12.50% in the quarter after that. In the rating firms’ projections, revenue will increase 0.10% compared to the previous financial year.
Revenue for the current quarter is expected to be $530k as predicted by 5 analyst(s). Meanwhile, a consensus of 5 analyst(s) estimates revenue growth to $540k by the end of Dec 2021. As per earnings report from last fiscal year’s results, sales for the corresponding quarters totaled $496k and $436k respectively. In this case, analysts expect current quarter sales to grow by 6.90% and then jump by 23.90% in the coming quarter.
Infinity insiders own 2.17% of total outstanding shares while institutional holders control 55.96%, with the float percentage being 57.20%. BVF Inc. is the largest shareholder of the company, while 98 institutions own stock in it. As of Mar 30, 2021, the company held over 8.38 million shares (or 9.46% of all shares), a total value of $27.08 million in shares. The next largest institutional holding, with 6.58 million shares, is of Consonance Capital Management LP’s that is approximately 7.42% of outstanding shares. At the market price on Mar 30, 2021, these shares were valued at $21.24 million.
Also, the Mutual Funds coming in first place with the largest holdings of Infinity Pharmaceuticals Inc. (INFI) shares are Vanguard Total Stock Market Index Fund and Vanguard Extended Market Index Fund. Data provided on Mar 30, 2021 indicates that Vanguard Total Stock Market Index Fund owns about 2.06 million shares. This amounts to just over 2.32 percent of the company’s overall shares, with a $6.64 million market value. The same data shows that the other fund manager holds slightly less at 1.38 million, or about 1.55% of the stock, which is worth about $4.45 million.
Stacy Lee of Stocks Register said that Infinity shares rose in value on September 22, with the stock price up by 1.40% to the previous day’s close as strong demand from buyers drove the stock to $3.63. Actively observing the price movement in the last trading, the stock closed the session at $3.58, falling within a range of $3.53 and $3.65. The value of beta (5-year monthly) was 2.29. Referring to stock’s 52-week performance, its high was $5.98, and the low was $1.00. On the whole, INFI has fluctuated by 13.44% over the past month.
Lee added, “With the market capitalization of Infinity standing at about $303.40 million, investors are eagerly awaiting this quarter’s results, scheduled for November. As a result, investors might want to see an improvement in the stock’s price before the company announces its earnings report. Analysts are projecting the company’s earnings per share (EPS) to be -$0.13, which is expected to increase to -$0.13 for fiscal year -$0.55 and then to about -$0.61 by fiscal year 2022. Data indicates that the EPS growth is expected to be 19.10% in 2022, while the next year’s EPS growth is forecast to be -10.90%.”