Bernstein has upgraded Summit Therapeutics Inc. to Market Perform from Underperform, citing a risk-adjusted valuation of the company’s lead drug candidate, Ivonescimab. The firm also raised its price target on Summit’s shares to $11.90 from $9.80, reflecting a 21% increase.
The Nasdaq-listed biotech, which has not yet published preliminary clinical data for Ivonescimab in squamous cell carcinoma of the head and neck (HNSCC), remains under pressure. Summit’s shares were trading at $12.73 on Tuesday, down 27% year-to-date and just 5% above the 52-week low of $12.07. The stock has fallen sharply from its 52-week high of $30.05.
Bernstein’s upgrade follows the company’s second-quarter financial results, which reported a net loss of $216 million. Adjusted loss per share came in at $0.3714, exceeding analyst expectations of a $0.28 loss per share. Summit ended the quarter with $691 million in cash.
The analyst firm assigned a 35% probability of technical success to the Phase 3 ILLUMINE study, aligning with the average success rate for Phase 3 oncology trials with overall survival as the primary endpoint. Bernstein noted that while early response rate indicators are encouraging, the study carries a higher risk of a negative overall survival outcome.
The firm’s valuation incorporates risk-adjusted cash flows, including potential incremental revenue in scenarios where Ivonescimab achieves positive results in urological or head and neck cancer studies. Bernstein also cautioned that the drug is unlikely to become a generalized substitute for Keytruda across different tumor types.
Summit’s clinical pipeline includes Ivonescimab, a late-stage drug currently under investigation in the Phase 3 ILLUMINE study. The company has not yet disclosed preliminary clinical data for HNSCC, which remains a key catalyst for investor sentiment.
Other analysts have also adjusted their outlooks on Summit. Stifel and Guggenheim raised their price targets to $38, while Cantor Fitzgerald maintained an above-average rating following the company’s financial results and pipeline updates. H.C. Wainwright reiterated a neutral stance without a specific price target. Guggenheim noted that the timeline for study data disclosure has been extended into early 2027.
