ALLO Hit With Bull Notes After Posting Positive Drug Data

Allogene just announced positive phase 1 study results for its non-Hodgkin lymphoma treatment

Allogene Therapeutics Inc (NASDAQ:ALLO) this morning released well-received data from its phase-one study of its non-Hodgkin lymphoma treatment, ALLO-501. The oncology firm expects to initiate the next steps of its phase-one study of the therapy in the second quarter of this year. In response, ALLO is up 16.2% to trade at $36.

The announcement sparked no less than four price-target hikes from analysts, the highest coming from Oppenheimer, which lifted its price target to $50 from $44. Suntrust Robinson, meanwhile, downgraded ALLO to "hold" from "buy," while lifting its price estimate to $32 from $29.

Coming into today, the 12-month consensus price target of $37.31 sat at a 21.2% premium to last night's close, with 11 covering the stock call it a "buy" or better, while five say "hold."

Today's pop puts ALLO right in line with its May 12, record high of $35.61, and back north of a long-term ceiling at the $34 level, which has thwarted countless breakout attempts since the stock went public in 2018. For the year, ALLO is up over 20%, with the 20-day moving average swooping in to catch yesterday's pullback.

This positive price action has prompted some short sellers to start hitting the exits, with short interest down 6.7% in the last reporting period. There's still plenty of pessimism to be unwound here, however. The 13.17 million shares sold short make up over a quarter of ALLO's available float. In other words, it would take 17.4 days to cover all these bearish bets, at the security's average pace of trading.