Wells Fargo Bullish On Applied Genetic Technologies Ahead Of Program Update

The bullish case for Applied Genetic Technologies Corp AGTC 19.34%, a nano-cap biotech conducting human clinical trials of adeno-associated virus-based gene therapies, can be made on the basis of an encouraging pipeline and valuation reasons, according to Wells Fargo.

The Analyst

Wells Fargo's Jim Birchenough upgraded Applied Genetic Technologies from Market Perform to Outperform with a price target lifted from $6 to $20.

The Thesis

Applied Genetic's peer Nightstar Therapeutics PLC NITE 2.49% released initial data from a Phase 1/2 study of its product candidate NSR-RPGR that showed multiple patients achieved an improvement in microperimetry, Birchenough said in the upgrade note. (See his track record here.)
This is notable, as Nightstar's efficacy in visual fields validates Applied Genetic's ongoing Phase 1/2 trial with its partner Biogen Inc BIIB 0.24%, the analyst said. There's evidence of higher gene expression with Applied Genetic's vector than with Nightstar's AAV8 vector, he said.
Nightstar's data release should be well-received by investors ahead of Applied Genetic's data flow and program updates in its X-linked retinitis pigmentosa trials, Birchenough said.
With the stock is trading below its cash on hand and at a discount to Nightstar, Applied Genetic has favorable risk-reward profile, according to Wells Fargo.
https://www.benzinga.com/analyst-ratings/analyst-color/18/09/12394892/wells-fargo-bullish-on-applied-genetic-technologies-ahe