In a report released yesterday, David Nierengarten from Wedbush downgraded Sutro Biopharma (STRO – Research Report) to a Hold, with a price target of $2.00.
David Nierengarten has given his Hold rating due to a combination of factors surrounding Sutro Biopharma’s recent strategic decisions and financial outlook. The company has decided to shift its focus away from luvelta, not due to its therapeutic potential, but rather for financial reasons. This reprioritization involves concentrating efforts on new candidates like STRO-004 and STRO-006, with significant clinical milestones expected in the coming years.
Additionally, the company’s restructuring plan includes a substantial reduction in workforce and a revised cash management strategy, aiming to sustain operations into late 2026. Despite the promising technology platform, the absence of immediate catalysts and the reset of clinical progress contribute to the neutral stance. The revised price target reflects these changes, with a focus on future sales potential of STRO-004, while removing previous valuations for luvelta and other partnered programs.