Avalo Therapeutics (AVTX) Stock Forecast & Price Target

Avalo Therapeutics is supported by a differentiated IL-1β thesis, with abdakibart posting a 16-week HiSCR75 win in the 253-patient LOTUS study, plus favorable IHS4 and draining-tunnel improvements and a clean safety profile without serious infections or opportunistic infections. Despite lowering the probability of success to 80% and cutting peak sales to $1.2B from $5.2B, the company still appears undervalued because the stock trades close to cash expected to fund it through Phase 3 data, while the HS market remains large at 1% to 4% global prevalence. The weaker-than-expected INTREPID readout for lutikizumab strengthens confidence that selective IL-1β blockade can still carve out meaningful later-line positioning, especially given abdakibart’s higher affinity, 73% bioavailability, and longer half-life that may support Q4W dosing.

Avalo Therapeutics is facing a fundamentally weaker investment case because INTREPID’s 8-point HiSCR75 advantage in 1,400 patients materially underperformed the 21-point Phase 2 result, raising concern that abdakibart’s 17.2-point LOTUS signal could also compress in Phase 3. With $472.2M in cash and investments at June 30 against a market cap of about $425M, cash has become the main valuation anchor, yet the company used $37.7M in operating cash during 1H26 and still plans to fund high-risk development through 2029. The pipeline is also concentrated in the same IL-1β pathway through abdakibart and AVTX-010, so disappointing competitive efficacy could leave limited commercial differentiation and justifies a cautious stance.