Tectonic Stock Soars Pre-market After Tuesday’s Sell-Off: Oppenheimer Is Hopeful About Company’s Lead Candidate

Shares of Tectonic Therapeutic (TECX) soared about 6% in Wednesday’s pre-market after Oppenheimer initiated coverage of the company with an ‘Outperform’ rating.

Oppenheimer has an $80 price target on Tectonic, representing an upside of over 380% from the stock’s closing price on Tuesday. The firm stated that it likes the prospects of Tectonic's lead asset, TX45, for addressing prevalent and progressive cardiovascular disorders that are currently inadequately treated.

The analyst is optimistic ahead of next year's mid-stage study data readout in pulmonary hypertension with heart failure with preserved ejection fraction, which it believes could pave the way for a multi-billion-dollar global sales opportunity, according to TheFly.

On Stocktwits, retail sentiment around Tectonic jumped from ‘bearish’ to ‘extremely bullish’ territory over the past 24 hours, while message volume rose from ‘normal’ to ‘extremely high’ levels.

Tectonic shares closed down 35% on Tuesday following Eli Lilly's (LLY) data presentation and publication from its failed study in heart failure patients with preserved ejection fraction using a recombinant long-acting relaxin mimetic, Volenrelaxin. Tectonic’s lead candidate also seeks to treat similar cardiovascular disorders.

According to Truist analyst Danielle Brill, the negative news "represents another hit to the emerging relaxin class of drugs." Still, the firm also notes that read-through should be limited as the population enrolled in Lilly's trial is distinct from those enrolled in Tectonic's.

The firm, which believes Tectonic's approach to targeting Combined Post- and Pre-Capillary Pulmonary Hypertension has "the strongest rationale" and calls the selloff "overdone," maintained a ‘Buy’ rating and a $64 price target on Tectonic shares.

TECX stock is down by 64% this year and by about 13% over the past 12 months. 

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