Affimed (AFMD – Research Report), the Healthcare sector company, was revisited by a Wall Street analyst yesterday. Analyst Yanan Zhu from Wells Fargo downgraded the rating on the stock to a Hold and gave it a $0.10 price target.
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Yanan Zhu has given his Hold rating due to a combination of factors surrounding Affimed’s financial situation. The company’s recent announcement to initiate insolvency proceedings has significantly impacted its financial outlook. This move indicates severe liquidity issues, as the company has been unable to secure sufficient capital despite engaging with potential investors and partners.
Affimed’s cash reserves have dwindled considerably, with cash and equivalents dropping from €24.1 million at the end of the third quarter of 2024 to approximately €13.0 million by the end of the fourth quarter. Given the company’s cash burn rate, there is a substantial risk to its ongoing operations. Consequently, the price target has been drastically reduced from $11 to $0.10, reflecting the assumed residual cash position per share. These financial challenges underpin the Hold rating, as the company’s ability to continue as a going concern is in question.
According to TipRanks, Zhu is an analyst with an average return of -7.9% and a 26.79% success rate. Zhu covers the Healthcare sector, focusing on stocks such as Regulus, uniQure, and Sarepta Therapeutics.
In another report released yesterday, Leerink Partners also downgraded the stock to a Hold with a $0.39 price target.