Please ensure Javascript is enabled for purposes of website accessibility

Why Inovio Stock Fell Today

By Joe Tenebruso – Jun 26, 2020 at 6:45PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

One analyst thinks the biotech's shares have come too far too fast.

What happened

Shares of Inovio Pharmaceuticals (INO -3.39%) declined on Friday after investment bank Stifel cut its rating on the biotech stock. 

So what

Stifel analyst Stephen Willey reduced his rating on Inovio's shares from buy to hold. Willey believes that after the stock's incredible gains in 2020 -- the stock is up a staggering 797% so far this year -- the risk-to-reward equation for investors is now "less palatable." 

A sculpture of a bull facing a sculpture of a bear.

The bears and bulls are battling over Inovio's shares. Image source: Getty Images.

Although Willey did raise his target price for Inovio's stock from $19 to $24, his new price forecast represents potential downside of 20% based on Inovio's closing price of $29.98 on Friday.

"While acknowledging peer COVID-19 vaccine company valuations would suggest we're potentially leaving significant upside on the table, should promising immunogenicity data (i.e. robust neutralizing antibody response) and a large government-written check subsequently materialize, we also believe any potential downside risk in the absence of the aforementioned events occurring is equally significant," Willey said. 

Now what

Not all analysts are bearish on Inovio's stock, however. On the same day that Willey cut his rating to hold, Cantor Fitzgerald analyst Charles Duncan reiterated his "overweight" rating on Inovio's shares and boosted his target price from $17 to $45. After studying the company's clinical programs and meeting with management, Duncan came away with a more bullish view of Inovio's vaccine development potential. 

As is often the case with early-stage biotech companies, analysts can have far different views. Ultimately, investors will need to decide for themselves whether they're bullish or bearish on Inovio's future prospects.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Inovio Pharmaceuticals, Inc. Stock Quote
Inovio Pharmaceuticals, Inc.
$1.71 (-3.39%) $0.06

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.