We came across a bullish thesis on Capricor Therapeutics, Inc. (CAPR) on wallstreetbets Subreddit Page by androidmj. In this article, we will summarize the bulls’ thesis on CAPR. Capricor Therapeutics, Inc. (CAPR)’s share was trading at $12.65 as of March 5th.
A laboratory filled with modern equipment, scientists examining the latest biotechnology breakthroughs.
Capricor Therapeutics (CAPR) is set for a high-stakes FDA decision on its Duchenne muscular dystrophy (DMD) therapy, Deramiocel (CAP-1002), with a PDUFA date of August 31, 2025. The drug, targeting DMD-related heart disease, has no direct competition and has received multiple FDA designations, including Priority Review, Orphan Drug, and Rare Pediatric Disease. Despite this, the stock is trading at a discount, largely due to market skepticism, high short interest (20% of float), and broader biotech sector struggles. The stock has remained range-bound since the FDA accepted the Biologics License Application (BLA) on March 4, 2025, despite the significance of the milestone.
CAPR is in a strong financial position, fully funded until at least 2027 with $175M in cash, no debt, and a commercialization partner in Nippon Shinyaku, which has already invested at a premium. If approved, Capricor stands to gain over $100M from selling its Priority Review Voucher (PRV), milestone payments exceeding $700M, and double-digit royalties on future sales. This financial stability removes the usual biotech overhang of dilution risk.
The stock’s current market cap of ~$580M suggests the market is discounting approval odds, despite analysts setting price targets between $34 and $77. Historical biotech runs following FDA approvals, such as Sarepta and Krystal Biotech, suggest a significant upside if Deramiocel is approved. With options activity heating up and the borrow rate climbing, short sellers are betting on additional FDA hurdles, yet no review issues or advisory committee meetings have been flagged so far.
For traders, CAPR presents multiple strategies, including a run-up trade into August, a binary PDUFA bet, or premium collection via put selling. If the FDA approves Deramiocel, the stock could skyrocket, while rejection would result in significant downside. CAPR’s setup offers a good opportunity with a defined catalyst and strong financial backing.
Capricor Therapeutics, Inc. (CAPR) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held CAPR at the end of the fourth quarter which was 12 in the previous quarter. While we acknowledge the risk and potential of CAPR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than CAPR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.