UPDATE: Stifel Initiates Coverage on Clovis Oncology with Hold Rating Awaiting More Attractive Entry Point

In a report published Friday, Stifel analyst Brian Klein initiated coverage on

with a Hold rating. In the report, Stifel noted, “While we view the early-stage clinical data for CO-1686 as encouraging, we believe the available dataset does not warrant the company's current $1.9 billion valuation. In our opinion, CO-1686 represents a very promising clinical asset that is targeting a true unmet medical need in patients with EGFR-mutation NSCLC who develop a T790M mutation following front-line therapy. However, we believe the current $1.9 billion valuation for the company, of which the majority is predicated on the commercial opportunity for CO-1686, is premature and not currently warranted given the early stage and associated risk involved in clinical development, specifically the uncertainty regarding the appropriate dosage and schedule, long-term impact of treatment on PFS and survival, the regulatory path for approval, and the future commercial landscape. Therefore we recommend that current shareholders retain their positions while those looking to invest in Clovis should await a more attractive entry point.” Clovis Oncology closed on Thursday at $66.26.