Truist Financial analyst Asthika Goonewardene downgraded the rating on Mersana Therapeutics to a Hold today, setting a price target of $30.75.
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Asthika Goonewardene has given his Hold rating due to a combination of factors surrounding the acquisition of Mersana Therapeutics by Day One Biopharmaceuticals. The acquisition deal offers $25.00 per share in cash and up to $30.25 per share in contingent value rights, which are dependent on achieving certain clinical and commercial milestones. This results in a potential total deal value of approximately $285 million.
Goonewardene believes the acquisition will proceed as planned, and the price target for Mersana has been adjusted to $30.75, reflecting the upfront cash offer and a risk-adjusted value for the contingent value rights. The Hold rating reflects the strategic alignment of Day One’s focus on niche indications, particularly in rare cancers like adenoid cystic carcinoma, which they aim to address with Emi-Le. This approach is seen as lower risk and aligns with Day One’s strategy of rapid market entry, although other indications for Emi-Le may be pursued in the future as the asset is further developed.
Goonewardene covers the Healthcare sector, focusing on stocks such as Summit Therapeutics, Genmab, and Revolution Medicines. According to TipRanks, Goonewardene has an average return of -7.3% and a 37.69% success rate on recommended stocks.
In another report released on November 5, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $8.00 price target.