Buy Rating Affirmed for CARGO Therapeutics on Robust Trial Progress and Strong Market Potential

Brian Cheng, an analyst from J.P. Morgan, maintained the Buy rating on CARGO Therapeutics, Inc. (CRGX – Research Report). The associated price target is $30.00.

Brian Cheng has given his Buy rating due to a combination of factors surrounding CARGO Therapeutics, Inc.’s promising developments and market potential. One of the primary reasons is the encouraging progress of the FIRCE-1 Phase 2 trial for their CD22-targeted CAR-T therapy, which is anticipated to address the unmet needs in the post CD19 CAR-T diffuse large B-cell lymphoma (DLBCL) treatment landscape. The interim analysis is expected to provide significant insights into the therapy’s efficacy, with the potential to demonstrate improved benefits over previous trials. Moreover, the expansion from 20 to 23 active sites for the trial enrollment indicates a robust execution capability by the management, which further instills confidence in the company’s timelines and future updates.
In addition to the clinical trial advancements, the financial valuation of the company also plays a role in the Buy recommendation. Cheng’s analysis includes a detailed projection of the company’s future value based on a discounted cash flow and sum-of-the-parts model. This valuation takes into account the potential market penetration and pricing of CARGO’s therapies, including their lead asset CRG-022, and factors in various scenarios of success and competition. With a price target set at $30, there is a clear expectation of significant upside potential from the company’s current performance, especially as it continues to progress its pipeline and expand its therapeutic offerings.

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CARGO Therapeutics, Inc. (CRGX) Company Description:

CARGO Therapeutics, Inc., a clinical-stage biotechnology company, develops chimeric antigen receptor (CAR) T-cell therapies for cancer patients. The company’s lead program is CRG-022, an autologous CD22 CAR T-cell product candidate designed to address resistance mechanisms by targeting CD22, an alternate tumor antigen that is expressed in B-cell malignancies. It also develops CRG-023, a tri-specific CAR T product candidate that targets tumor cells with three B-cell antigen targets. The company was formerly known as Syncopation Life Sciences, Inc. and changed its name to CARGO Therapeutics, Inc. in September 2022. CARGO Therapeutics, Inc. was incorporated in 2019 and is headquartered in San Mateo, California.