Psychedelic drug trial results disappoint, but positive outlook for future trials

From Yahoo Finance: 2025-06-29 07:00:00

Psychedelic stocks are in the spotlight for treating mental illnesses like depression and PTSD. Compass Pathways’ synthetic psilocybin drug showed a 3.6-point symptom reduction in depression patients, falling short of Wall Street’s expectations. Despite the drop, analysts are optimistic about future trials for PTSD. Investors may see this as an opportunity to invest.

Compass Pathways, a London-based biotech company, focuses on psilocybin treatments for mental health conditions. With a market cap of $248 million, the stock has dropped 54% in the past year. Despite this, the stock is trading at a more attractive valuation relative to its peers.

COMP360’s trial results may have disappointed markets, but Compass Pathways is preparing for a significant catalyst in 2026 with Phase 3 trial results. Investors remain cautious about long-term effects and patient variability, but positive results could propel Compass towards FDA approval.

Financially, Compass Pathways reported $260.1 million in cash in Q1 2025. The company expects this cash to support operations through the second half of 2026. Wall Street analysts are bullish on the stock, with a consensus “Strong Buy” rating and a 483% upside potential from current levels.

Despite regulatory challenges and clinical uncertainty, Compass Pathways offers a compelling opportunity for investors with a long-term view on psychedelic medicine. The recent dip in stock price may be an attractive entry point for those interested in this high-risk, high-reward sector.



Read more at Yahoo Finance: This Psychedelic Drug Flopped on Trial Results. Should You Buy the Dip?