Laidlaw Reiterates Buy Rating on Arcturus Therapeutics (ARCT) with $40 Price Target

Today after the market close, ARCT reported 2Q26 financial results and corporate updates. Our takeaway is the future development decisions of ARCT-032 in CF and ARCT-810 in pediatric and adult OTC deficiency will likely be made over the next few months, starting in later 3Q26 for ARCT-810. Clinical data releases of ARCT-032 10mg 12 weeks in CF trial and the more detailed ARCT-810 in adult OTC deficiency study will be important drivers for ARCT shares. Lastly, we view CSL vaccine deal termination just the close of a chapter that we believe has no impact on ARCT’s future development. 2Q26 financial results showed a net loss of ($23.8MM) vs. ($24.87MM) for Laidlaw and ($28.5MM) for the Street. Net loss/share was ($0.84) vs. ($0.87) for Laidlaw and ($0.97) for the Street. ARCT ended the quarter with ~$191MM cash, which we anticipate can support ARCT operations into 4Q28. The ARCT-032 in CF 10mg 12 weeks treatment study is underway and patient enrollment has expanded beyond the U.S. into Israel and Turkey. ARCT indicated it will make a decision as to advance ARCT-032 in CF development into Phase III study in 4Q26. A potential go decision could trigger significant resources and support from Thermo Fisher as CRO/CMO with a $40MM funding that could offset clinical manufacturing service expenses at the same cost. We think ARCT may also report topline results of this clinical study likely later. ARCT completed patient enrollment and dosing of its open label clinical study evaluating ARCT-810 in adult OTC deficiency. ARCT also is evaluating supplementary data requested by the FDA, such as 0.3 and 0.5mg/kg five biweekly IV infusions dose outcomes. ARCT is scheduled to report clinical data and the future regulatory plan in 3Q26. CSL Seqirus and ARCT have terminated their collaboration on all vaccine programs. ARCT regains entire global rights of all vaccine programs, including Kostaive, seasonal and pandemic influenza, RSV, and EBV vaccines. We are reiterating our Buy rating and $40 target price. 

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