Centessa Pharmaceuticals (CNTA), CG Oncology (CGON) and Contineum Therapeutics (CTNM) delivered a series of clinical and financial updates in Q3, standing out as key outperformers on rising confidence in late-stage programs, Morgan Stanley said Friday in a report.

Sector momentum was fueled by higher success assumptions for late-stage trials, tighter spending discipline that extended cash runways, and a pipeline of catalysts expected to shape development through 2027, the report said.

Morgan Stanley boosted its price target on Centessa's shares to $36 from $27 after new Phase 2a results strengthened conviction in ORX750's potential as a leading treatment for sleep disorders.

The firm raised its price target on CG Oncology stock to $82 from $79 as the company began a rolling FDA application for cretostimogene in bladder cancer patients who no longer respond to BCG therapy, and prepared key data readouts for the December Society of Urologic Oncology meeting.

Contineum's price target was lifted to $23 from $21, reflecting continued progress ahead of its Q4 readout for PIPE-307 in relapsing-remitting multiple sclerosis and a sharpened focus on PIPE-791 for idiopathic pulmonary fibrosis, the report said.

Morgan Stanley also raised its price targets on Denali Therapeutics (DNLI) to $32 from $30 and on Recursion Pharmaceuticals (RXRX) to $5 from $4.80.

Price: 28.37, Change: +0.76, Percent Change: +2.75