Freedom Broker: Nektar may jump 22% in two months on potential upbeat trial results

Freedom Broker has issued a short-term investment idea to buy shares of Nektar Therapeutics, a small-cap biotech developing a drug for alopecia areata, an autoimmune condition that causes hair loss. On Tuesday, December 16, the company is set to release new clinical trial data on its lead therapy. If the results are positive, Nektar shares could gain about 22% over the next two months, Freedom Broker analysts said.

Investors should take a look at Nektar Therapeutics, Freedom Broker wrote in an investment idea note seen by Oninvest.

The company is scheduled to present new data from clinical trials of its lead drug candidate, rezpegaldesleukin, or Rezpeg, on Tuesday. The therapy is being studied in patients with severe alopecia areata, a condition that leads to partial or complete hair loss.

Rezpeg is currently in a phase II, mid-stage clinical trial. A successful readout would improve Nektar’s long-term revenue outlook and could push the shares back toward their 2025 highs, Freedom believes.

The analysts set a two-month target price of $64.90 per share for Nektar. That implies upside of nearly 22% versus the December 15 close of $53.30 per share. In early trading on Tuesday, ahead of the data release, Nektar shares were up more than 7% as of this writing.

Nektar develops drugs to treat autoimmune and chronic inflammatory diseases by modulating immune cell activity. The company has five programs in its pipeline, rezpegaldesleukin being its most important asset.

Several drugs are already approved to treat alopecia areata, including therapies from Eli Lilly, Pfizer, and Sun Pharma. AbbVie is also developing a treatment in this indication, with its drug currently in phase III trials and approval expected before 2028, Freedom wrote.

However, existing therapies are oral drugs taken daily and trigger serious adverse reactions, which limits patient uptake and underscores the need for alternative approaches, according to the investment idea note. Rezpegaldesleukin, by contrast, is administered subcutaneously once every two weeks.

Nektar shares have soared 282% year to date. Wall Street analysts, however, believe further gains are possible, according to MarketWatch data. The stock has eight “buy” ratings versus just one “hold.” The average target price of $107.30 per share implies upside of roughly 100% versus current levels.