TD Cowen has reaffirmed a Hold rating on GRAIL, Inc. (NASDAQ:GRAL) and maintained a $114.00 price target after the company disclosed that its NHS-Galleri pivotal study did not meet the trial's primary endpoint. The market reaction was immediate and severe: GRAIL shares fell to $53.68 from a previous close of $102.28.
The NHS-Galleri study was a key trial for GRAIL's multi-cancer early detection test, Galleri. Management stated that they see supportive signals in the trial data for the test's utility and that they remain confident in the prospects for U.S. Food and Drug Administration approval.
In response to the trial outcome, TD Cowen said it is reviewing its financial model and assessing the data before deciding whether to adjust its price target. The firm reiterated that earlier analysis suggested a failed NHS study could negatively affect major near-term catalysts, including both FDA approval and potential Medicare coverage. Despite that, TD Cowen acknowledged that company management continues to hold a positive outlook on both regulatory clearance and reimbursement pathways.
TD Cowen reported it is performing additional diligence with key opinion leaders on several outstanding issues while reassessing its valuation framework and assumptions. The firm highlighted a material risk now exists regarding Medicare coverage and said there is some risk to FDA approval, though it noted management's optimism on the approval front.
In its recent initiation, TD Cowen had previously warned that a failure in the NHS trial could push the stock down to roughly $18, which the firm described as representing cash value if the multi-cancer early detection opportunity were largely eroded. That reference remains on the table as the firm evaluates how the trial results affect the company's strategic outlook.
Financial metrics cited in available company analyses indicate a strong balance sheet, with more cash than debt and a current ratio of 11.97. The company remains unprofitable with reported earnings per share of -$11.11. A fair value analysis published in those materials suggested the shares might be undervalued at current levels, and a detailed institutional research report is available for subscribers seeking deeper analysis.
Operationally, GRAIL reported fourth-quarter and full-year 2025 results that beat Canaccord Genuity's estimates and the FactSet consensus, driven by a 35% year-over-year increase in Galleri testing volume. Those results underscore continued demand growth for the test even as the pivotal trial failed to achieve statistical significance on its primary endpoint.
Following the trial update, Canaccord Genuity trimmed its price target on GRAIL from $105 to $80, citing the NHS-Galleri outcome. Despite reducing the target, Canaccord maintained a Buy rating, citing the company’s strong financial performance. Separately, TD Cowen's initiation placed a Hold rating with a $114 target, and Baird started coverage with an Outperform rating and a $113 price target, noting speculative risk but emphasizing Galleri's potential.
Together, these analyst actions reflect a mix of optimism about the underlying test demand and financial performance and caution driven by the clinical trial setback and the resulting uncertainty around regulatory approval and reimbursement.
Key points
- TD Cowen reiterated a Hold rating and a $114.00 price target on GRAIL after the NHS-Galleri study missed its primary endpoint.
- GRAIL shares plunged to $53.68 from a prior close of $102.28 following the trial results.
- Analysts and management are divided between optimism on the company’s commercial momentum and concern over regulatory and Medicare reimbursement risks.
Risks and uncertainties
- Material risk to Medicare coverage exists following the NHS-Galleri trial outcome, which could affect reimbursement for the Galleri test.
- There is some risk to FDA approval based on the trial failure, despite management's stated optimism on the approval pathway.
- Market valuation is uncertain; prior firm analysis indicated a potential downside to roughly $18 if the multi-cancer early detection opportunity is significantly impaired.