Salveen Richter has soured on CRISPR Therapeutics (NASDAQ:CRSP). And Richter's opinion carries a lot of weight. She's a top healthcare analyst with Goldman Sachs. 

Richter recently downgraded CRISPR Therapeutics stock from "buy" to "neutral." She also slashed her one-year price target for CRISPR Therapeutics from $78 to $40. That reflects a lot of negativity about the gene-editing stock. But there's something important lost in the news about this big downgrade: Richter still thinks CRISPR Therapeutics shares will jump another 20% or more.

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Behind the pessimism

There were three primary reasons behind Salveen Richter's major downgrade of CRISPR Therapeutics. Two relate to competition, and another relates to catalysts -- or the lack thereof.

CRISPR Therapeutics' lead candidate CTX001 targets the treatment of rare blood disorders beta-thalassemia and sickle cell disease. The biotech and its partner, Vertex Pharmaceuticals, are conducting early-stage clinical studies for the gene-editing therapy in both targeted indications.

Richter, however, thinks that bluebird bio will enjoy a first-mover advantage that could present a big obstacle to CRISPR Therapeutics. Bluebird has already filed for approval in Europe for gene therapy LentiGlobin in treating transfusion-dependent beta-thalassemia (TDT) and expects a decision later this year. The biotech is also pursuing an accelerated development pathway in the U.S. for LentiGlobin as a treatment for sickle cell disease.

CRISPR Therapeutics also hopes to advance its lead allogeneic chimeric antigen receptor T cell (CAR-T) therapy CTX110 into an early-stage clinical trial in the first half of 2019. But Richter sees increasing competition in the race to develop allogeneic -- or "off-the-shelf" -- CAR-T therapies. This competition includes smaller players like Allogene Therapeutics and giant biotechs like Gilead Sciences.

Richter doesn't think there are any major catalysts on the horizon for CRISPR Therapeutics, either. The company won't announce any results from its studies of CTX001 or CTX110 anytime soon. And the possibility that CRISPR Therapeutics could be acquired in the near future is relatively low.

A shiny silver lining

You might think that Richter's pessimism about CRISPR Therapeutics paints a horrible picture for the small biotech stock's prospects over the next year. But that's really not the case at all. Richter's revised one-year price target of $40 still represents a premium of nearly 22% above CRISPR Therapeutics' current share price.

Several Wall Street analysts are even more bullish about CRISPR Therapeutics. The consensus one-year price target for the biotech stock reflects a premium of nearly 93%. The most optimistic analyst thinks that CRISPR Therapeutics could soar 138% higher.

Even though Salveen Richter is more pessimistic than several other analysts and more pessimistic about CRISPR Therapeutics than she's been in the past, on a relative basis, she's still optimistic. Why? It's pretty simple.

While Bluebird is likely to get a nice head start on CRISPR Therapeutics in beta-thalassemia, there's still a reasonable chance that CRISPR Therapeutics' gene-editing approach could be more effective than Bluebird's gene therapy. There should also be plenty of room for multiple winners in the allogeneic CAR-T market down the road. 

In addition, the lack of major catalysts in 2019 isn't that big a problem for CRISPR Therapeutics. Investors know that there should be plenty of news in the future that could drive the stock much higher.

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Believe the analysts?

If you believe most of the Wall Street analysts -- including Salveen Richter -- CRISPR Therapeutics still appears to be a great stock to buy. But should you believe Wall Street? Yes and no.

It's probably not a good idea to put too much confidence in analysts' one-year price targets. They really don't know how much a stock will move up or down. All they can do is put forward their best guesses. 

On the other hand, Wall Street's general bullishness about CRISPR Therapeutics seems warranted if you take a long-term view. The biotech could be on track to market effective treatments for beta-thalassemia, sickle cell disease, and cancer in a few years if all goes well in clinical testing. And if CRISPR Therapeutics succeeds on these fronts, you can bet that bigger players (probably including its partner, Vertex) will put the biotech on their acquisition radar screens.

CRISPR Therapeutics still faces significant risks, though. There's no guarantee that its experimental therapies will pan out. But if they do, even the optimism found on Wall Street today could look pessimistic.