Our Stock of the Week is Sagimet Biosciences Inc. (SGMT). This clinical-stage biotechnology company is focused on developing novel therapeutics targeting dysfunctional metabolic pathways in diseases driven by excess lipid accumulation, especially in the liver.
Sagimet’s lead product candidate is denifanstat, an oral FASN (fatty acid synthase) inhibitor currently in Phase 2b clinical development for nonalcoholic steatohepatitis (NASH). NASH is a progressive liver disease with no FDA-approved treatments and growing prevalence globally. Denifanstat has shown potential to reduce liver fat and inflammation, offering a promising differentiated mechanism in a competitive landscape.
Another FASN-related malady is acne, and early last month, SGMT surged higher on news that Sagimet’s license partner, Ascletis Bioscience, reported that denifanstat had met all primary and secondary endpoints in a Phase 3 clinical trial for the treatment of moderate to severe acne vulgaris. Following that news, shares saw significant upside follow-through, gaining over 170% over the next three weeks.
Since the, SGMT has been forming a textbook ascending triangle at 52-week highs, with support along its rising 20-day moving average, a move out of that pattern could attract buyers’ attention.
Given that this is name is highly speculative, we’d look to build a position within the current pattern and make sure to set stops should the set-up go the other way.
This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell, or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength and buy or sell anytime for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees, and affiliates of Shark Investing, Inc. and/or principals, clients, employees, and affiliates of Hammerhead Financial Strategies, LLC, directly or indirectly, controlled investment and/or trading accounts containing no positions in SGMT. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.
