ProKidney (PROK) shares soared as much as 660% this morning after the biotech firm said its Rilparencel showed promising results as a treatment of chronic kidney disease in a Phase 2 trial.
The company’s candidate treatment did not exhibit any serious adverse events during the course of the mid-stage trial either – its press release confirmed on Tuesday.
Including today’s meteoric run, ProKidney stock is trading at roughly 740% from its year-to-date low set in April.
Why Is ProKidney Stock Rallying Hard on Tuesday?
The REGEN-007 clinical trial update is significant for ProKidney investors since it clears the path for Rilparencel to advance into Phase 3 evaluation and eventually attempt to secure FDA approval.
Positive mid-stage data often leads to a significant increase in a biotech firm’s valuation, attract institutional interest, and raise the likelihood of strategic partnerships or future funding.
This milestone position ProKidney, which targets chronic kidney disease, as a potential front-runner in renal regenerative medicine.
That’s why PROK shares are ripping massively to the upside on Tuesday.
Why PROK Shares Aren’t Worth Owning Here
While the Rilparencel data reported this morning is positive for ProKidney, investors should note that it, nonetheless, is a penny stock with a market cap of just $177 million.
ProKidney shares, therefore, remain inherently risky to own – especially after today’s cosmic run – as penny stocks often suffer from low liquidity and high volatility.
PROK stock is exposed to sharp price swings and speculative hype also because it’s a pre-revenue company that’s relying on continued positive trial updates and regulatory approvals that are not guaranteed.
Wall Street’s View on ProKidney Stock
Investors should remain wary of buying ProKidney stock at current levels also because it’s already trading near analysts’ average price target.
While the consensus rating on PROK shares remains at “Moderate Buy,” the mean target of $4.33 is below its current trading price.
