CRBP - Corbus Pharmaceuticals (CRBP) is up 250%: what's up with the stock?
2024-01-29 07:18:08 ET
The stock of Corbus Pharmaceuticals Holdings, Inc. (NASDAQ:CRBP) closed up nearly 250% last week. The gains happened after favourable pharmaceutical news that saw the stock climb above $29. CRBP was previously trading at a meagre valuation below $7. Despite the stock trading almost 25% lower in premarket on Monday, the developments are worth attention.
Corbus Pharmaceuticals is a precision oncology company seeking to help people defeat serious illnesses. The company targets very rare and serious diseases using innovative scientific approaches.
Financially, the Massachusetts-based biotech is a loss-making entity. In Q3 2023, the company made a net loss of $10.1 (£8) million. The loss worsened from $8.8 (£6.9) million in the comparable quarter of 2022. The higher loss was mainly contributed by rising operating expenses, which widened by $1.3 (£1.03) million. The loss isn’t uncommon among growth companies yet to debut recognisable product portfolios in the market.
Nonetheless, Corbus is making progress in the pharmaceutical sector. The biotech rattled stock markets on Friday after it announced positive results from its drug candidate. The first-in-human clinical study of its antibody drug CRB-701 yielded strong efficacy and safety results. The drug is among three on the Corbus pipeline in advanced clinical trials.
The positive clinical results raise optimism about the potential FDA approval of the drug. Investors are pricing the stock in line with the expectation. This considers that clinical-stage outcomes matter a lot for biotech companies. As such, it is doubtless that this stock can surge in valuation should CRB-701 get the FDA greenlight. But the current valuation may just be too high for now.
CRBP technical analysis – stock corrects in premarket
A technical outlook shows Corbus correcting after trading at an extremely overbought level. The RSI reading of 88 suggests the stock is still overbought, cementing a correction phase. However, relatively, Corbus is a shell of its pandemic highs.
Is Corbus Pharmaceuticals stock attractive?
Friday’s stock surge of Corbus Pharmaceuticals shows investors are still exploring low-cap, undervalued stocks. The approval of its drug candidates is expected to boost the stock that was once a pandemic darling.
Despite the recent high of $29, Corbus can realistically move higher. The stock has pandemic highs of over $290. Thus, Corbus is certainly undervalued and one for a long-term focused investor. In the meantime, the current correction could continue as optimism around recent news abates.
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