Kardigan Inc: Attractive Entry Point Ahead of 1H27 Catalysts - Initiate at Buy

We initiate coverage of Kardigan (KARD) with a Buy rating and $25 PT. Led by the former MyoKardia team, KARD is building a precision cardiology franchise that currently includes three Phase 2 programs, with readouts expected in 1H27: danicamtiv (dani) in genetic dilated cardiomyopathy (DCM), ataciguat (ATA) in calcific aortic valve stenosis (CAVS), and tonlamarsen (TLA) in acute severe hypertension (ASH). Our valuation is primarily driven by dani and ATA, which we estimate can generate 2035 risk-adjusted sales of ~$1.1B and ~$890M (vs $1.2B/$1.1B cons) with 60% and 40% overall POS. We are positive on the upcoming Phase 2b readouts for dani and ATA, based on positive early clinical data, and KOL feedback. The stock has pulled back since early September, which we attribute largely to broader biotech and recent IPO weakness, as well as rising rates, rather than any deterioration in KARD fundamentals. As a result, we see an attractive entry point ahead of key 1H27 catalysts. Our $25 PT is