Morgan Stanley Nearly Doubled Its Price Target for CRISPR Therapeutics. Is the Gene-Editing Stock a No-Brainer Buy?

CRISPR Therapeutics (CRSP +1.68%) has had a terrible year, with the stock down 11% as of writing, while the S&P 500 is up 7%. However, the biotech has several catalysts on the horizon, and some analysts are taking notice. Terence Flynn, a Morgan Stanley (MS +3.41%) analyst, recently raised his CRISPR Therapeutics price target to $60, up from $33, and upgraded his rating to “hold.” This new target implies the stock could rise by 26% from its current levels. That said, is now a good time to buy CRISPR Therapeutics’ shares?

Image source: The Motley Fool.

What the future may hold

CRISPR Therapeutics is a gene-editing specialist. The company has an approved medicine, Casgevy, that it developed with Vertex Pharmaceuticals (VRTX -0.34%). Casgevy treats two rare blood disorders: Transfusion-dependent beta-thalassemia and sickle-cell disease. Earlier this year, CRISPR Therapeutics and Vertex announced that the U.S. Food and Drug Administration had expanded the label for Casgevy. It is now indicated to treat patients as young as two. The medicine hasn’t generated significant sales since its 2023 approval because it is expensive and difficult to administer. But with growing third-party coverage and an important label expansion, Casgevy’s sales should ramp up over the next few quarters.

Today’s Change

(1.68%) $0.80

Current Price

$48.44

Key Data Points

Market Cap

$4.6BMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.

Day’s Range

$47.50 – $48.73

52wk Range

$44.12 – $78.48

Volume

1.4M

Avg Vol

1.7M

Gross Margin

-528340.24%

That said, CRISPR Therapeutics’ performance over the next two years will likely depend much more on clinical progress with some of its leading candidates. The company expects important data readouts by the end of the year, including for CTX310, a medicine being developed to lower LDL cholesterol and triglycerides (TGs), both of which are linked to various cardiovascular conditions at high levels. The beauty of CTX310 is that it could be a one-and-done therapy for certain patients with high LDL or TGs. Many current options need to be taken regularly over long periods, so CTX310 might be a game changer.

We could say the same about the company’s CTX611, an investigational anticoagulant that could be administered twice a year, whereas current options are taken much more frequently. CTX611 is also being developed to address one of the most important side effects of today’s anticoagulants: Bleeding risk. Positive data from ongoing clinical trials for these therapies will jolt the stock. Of course, CRISPR Therapeutics has other products beyond those that may also complete studies within the next couple of years. There is the very real risk of clinical setbacks that could sink its share price, and investors should keep that in mind.

But considering CRISPR Therapeutics has already shown it can earn approval for a gene-editing medicine — most other biotech companies that specialize in this field haven’t done so — its deep pipeline, as well as revenue from Casgevy that should ramp up over the next year, CRISPR Therapeutics looks like an attractive stock right now.