1. Acelyrin, Inc. (NASDAQ:SLRN)
Number of Hedge Fund Investors: 24
The American biopharmaceutical company Acelyrin, Inc. (NASDAQ:SLRN) is committed to creating and marketing advanced medicines for autoimmune diseases. Its main candidate, izokibep, is an interleukin-17A inhibitor that targets hidradenitis suppurativa (HS) and psoriatic arthritis (PsA). It is a monoclonal antibody used to treat hidradenitis suppurativa, a chronic inflammatory skin condition.
Months after a $540 million IPO, Acelyrin’s izokibep phase 3 clinical study failed, triggering an 81% decline in the company’s stock price in September 2023 to date. However, recent trial findings show growth after prior setbacks.
SRLN is one of the best new penny stocks to buy now. The date of the IPO for SRLN is May 5, 2023. As of Q1 2024, the firm’s investors included 24 of the 920 hedge funds surveyed by Insider Monkey, in line with the prior quarter.
Acelyrin has a strong financial standing. The firm completed Q1 2024 with $678.5 million in cash and equivalents, 134.63% cash growth from the same quarter last year, which is projected to finance operations through 2026. Acelyrin, Inc. (NASDAQ:SLRN) reported -$0.36 EPS in the first quarter of fiscal year 2024, beating the consensus expectation of -$0.93.
In a recent Phase 2/3 study in PsA, Izokibep had substantial statistical significance in meeting the main objective of ACR50 at week 16. This is noteworthy considering the increased baseline disease burden compared to previous studies since the 160 mg weekly and bi-weekly dosages demonstrated superior responses in higher hurdle endpoints such as ACR70 and PASI100. Even though early trial execution mistakes were present, long-term data in HS also indicates a possible route to market.
Acelyrin’s strategy, which is supported by the performance of comparable IL-17 inhibitors like Cosentyx, is intended to set izokibep apart in the highly competitive PsA market. Effective strategies, such as emphasizing enhanced safety and effectiveness characteristics, are crucial for breaking into new markets. Following a 10% increase on PsA news, the enterprise value turned positive, suggesting room for expansion.
The company’s second Phase 3 study for the treatment of izokibep HS has completed enrollment of 258 patients, and topline findings have been moved up to 3Q24 due to faster-than-expected enrollment. Lonigutamab’s Ph1/2 update could be beneficial since it will provide further information on the dose for a future thyroid eye disease trial. An early assessment of SLRN-517 is in progress. Moreover, the company has nominated Mina Kim, who served as its chief legal and administrative officer, to the board of directors and to assume the role of CEO.
However, risks include clinical program effectiveness falling below expectations and safety alerts arising with any of the company’s preclinical or clinical projects.
Nonetheless, analysts are bullish on the stock and rate it as a “buy” with an average target price of $12.8 and a potential upside of 148.30%.
In conclusion, Acelyrin, Inc. (NASDAQ:SLRN) has upside growth potential because of its recent favorable trial findings and strong financial position.
While we acknowledge the potential of 10 Best New Penny Stocks To Buy Now, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SLRN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: Analyst Sees a New $25 Billion “Opportunity” for NVIDIA and Jim Cramer is Recommending These 10 Stocks in June.
Disclosure: None. 10 Best New Penny Stocks To Buy Now is originally published on Insider Monkey. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
