Intellia Stock Dips After Morgan Stanley Downgrade, Retail Sentiment Weakens

synopsis

Intellia Therapeutics, Inc. shares declined over 5% on Monday morning after Morgan Stanley downgraded the stock to ‘Equal Weight’ from ‘Overweight,’ slashing its price target from $56 to $11. 

The downgrade and what the brokerage says is a broader lack of catalysts for the year dented retail sentiment, with conversations on Stocktwits turning more skeptical.

Morgan Stanley cited a “more measured launch” for nexiguran ziclumeran, Intellia’s lead therapy for transthyretin amyloidosis, a rare and progressive heart disorder. 

The brokerage also pointed to the company’s recent discontinuation of its NTLA-3001 program for alpha-1 antitrypsin deficiency-associated lung disease, reducing near-term growth prospects.

The analyst noted growing competition from non-gene-editing therapies, which could challenge Intellia’s position as a leader in “in vivo” CRISPR editing. 

Intellia’s approach reportedly delivers CRISPR components directly into the body to modify DNA, bypassing the need to engineer treatments from a patient’s cells.

Earlier this month, Intellia announced a 27% workforce reduction and plans to halt the development of NTLA-3001 and some early-stage research programs.

The company expects to incur $8 million in restructuring charges in the first quarter but believes the changes, combined with its cash balance of $862 million at the end of the fourth quarter, will extend its cash runway into the first half of 2027.

NTLA sentiment and message volume Jan 27 as of 11:40 am ET | source: Stocktwits

Retail sentiment on Stocktwits turned more ‘bearish’ following the downgrade. 

Intellia’s stock has a high short interest of 21.3% and has lost nearly 60% over the past 12 months.

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