ADTX - Aditxt (ADTX) stock price just soared but gains could be brief
2023-12-12 10:50:59 ET
The Aditxt (NASDAQ: ADTX) stock price jumped by more than 83% on Tuesday, making it one of the best performers in Wall Street. The shares surged to a high of $9.47, its highest point since October 19th. At its peak, the stock was up by more than 195% from its lowest point in 2023.
The main reason for the surge was that the company agreed to acquire Evofem Biosciences for a combination of stock and debt. Evofem Biosciences stock, on the other hand, crashed by over 58%, giving it a market cap of about $921k.
Evofem is a company focused on women. Its core product is known as Phexxi, which is an on-demand hormone-free prescription that women can control. While this is a big market opportunity, Evofem’s revenue has been below expectations.
Evofem had over $5.1 million in revenue in the third quarter of this year, down from $6.4 million it made in the same quarter in 2022. Its loss from operations came in at $3.6 million. Its balance sheet was also in trouble as its restricted cash dropped to just $400k.
Aditxt will now assume Evofem’s secured debt and pay $5 million by end of the year to its debt holders. It will also provide a $3 million loan to Evofem to cover its expenses and issue 610k shares of Evofem’s common stock.
It is not clear how Aditxt will fund this acquisition. For one, it has been one of the most dilutive companies in Wall Street. The total outstanding shares have jumped from 7.3k in July 2021 to almost 400k today. The company has sold shares several times this year.
In September, it issued a $10 million share placement to fund its working capital and handle other general corporate activities. In November, it sold up to 264k shares of common stock to holders.
Aditxt is also losing a lot of money every quarter. It had a net loss of $9.7 million in the most recent quarter. It has lost over over $37 million in the past five quarters, according to data compiled by SeekingAlpha.
Therefore, I believe that the ongoing ADTX stock price pump will be short-lived as the Evofem acquisition hype fades.
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