The Aravive Inc (NASDAQ: ARAV) stock price rallied 21.97% despite the company's lack of significant news releases. The lack of news from the company leads us to believe that the renewed investor interest in the company since over 30.61 million ARAV shares had changed hands at writing.
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The company has suffered from various analysts' downgrades, with the latest downgrade from Cantor Fitzgerald downgrading the company from overweight to neutral. Cantor Fitzgerald analyst Louise Chen downgraded Aravive to Neutral from Overweight with a price target of 25c, down from $18, post the Q2 report.
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The company recently announced that to preserve its cash flow, it had terminated its Phase 1b/Phase 2 trials of batiraxcept in clear cell renal cell carcinoma and pancreatic adenocarcinoma unless it raises more capital, the analyst tells investors in a research note.
The downgrade from Cantor Fitzgerald also noted that the company was at risk of ceasing operations if it did not raise capital urgently or find a strategic partner to support it financially. So far, there is no news of any new funding deals signed by the company, which only had weeks of cash runway.
The renewed investor interest in the company could turn it into a meme stock if the current rally persists. Still, the company has a long way to go before recouping its recent losses, which were triggered by the failure of its lead clinical trial.
Aravive announced that the Phase 3 trial (AXLerate-OC) evaluating the safety and efficacy of its product candidate batiraxcept in ovarian cancer did not achieve the primary endpoint of progression-free survival.
The disappointing clinical trial results triggered a massive 70% decline in Aravive stock price, which fell from a high of $1.24 to a low of $0.2958 after the announcement. The company has been trading sideways for the rest of the month since the news broke on August 3, 2023.
Aravive was also downgraded to hold from buy at EF Hutton as analyst Tony Butler downgraded the firm to Hold from Buy with a price target of $1, down from $10, after the Phase 3 trial of batiraxcept to treat ovarian cancer failed.
Aravive stock price.
The Aravive (ARAV) stock price rallied 21.97% to trade at $0.1460, from Tuesday’s closing price of $0.1197.
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