Barclays Downgrades Cellectis to Underweight, Cuts Target to $1.30

Barclays has downgraded Cellectis (CLLS) from Overweight to Underweight, citing skepticism regarding the biotech firm's strategic pivot toward in-vivo gene editing programs. The bank also reduced its price target for the stock from $9.00 to $1.30, reflecting a shift in the market outlook for the company.

"The valuation model now assigns negative net present values to the company's new programs, specifically -$4 per share for .HEAL-101 and -$2 per share for .HEAL-201," said Lukas Shumway, analyst at Barclays, in a research note.

Valuation Model and Pipeline Adjustments

The reduction in price target stems from a reassessment of the Cellectis pipeline. By assigning negative values to the .HEAL-101 and .HEAL-201 programs, the analyst views these assets as cash-burn liabilities instead of revenue drivers. This approach accounts for the difference between the previous $9.00 target and the current $1.30 valuation.

Beyond the asset revaluation, the firm’s model incorporates an assumption that Cellectis will require a fresh capital raise by late 2027 to sustain operations. This projection reflects concerns regarding the capital-intensive nature of long-term biotech development and the company's current cash runway.

Clinical Roadmap and Market Outlook

Cellectis is working toward clinical entry for its .HEAL-101 program, which targets severe hypertriglyceridemia. The company has outlined a timeline to initiate clinical trials in China during the first quarter of 2027.

This development is important for the company's pivot, as it moves away from earlier pipeline assets that were removed from the Barclays valuation model. The stake for shareholders remains tied to the execution of this clinical roadmap, as the firm’s ability to secure future funding will depend on the progress and safety data generated from these in-vivo trials.