Announced offering. Last Friday, Baudax Bio announced a $10 million public offering, composed of 3,508,772 shares of common stock sold together with 3,508,772 warrants allowing for the purchase of a common share at $3.25. The offering price of the stock and warrant unit is $2.85. The warrants will be exercisable immediately after the offering and expire in five years. The offering is expected to close on or about March 1, 2022.Current market environment increases the share count. While the capital raise was anticipated, the market environment has been decidedly unforgiving. While we believe it is unwarranted, the stock price has declined roughly 70% from where it was prior to the announced split. With the stock price decline, a greater number of shares are required to support company needs. With the weakness, the issued share count (post-split) more than doubles from the current 2.9 million shares outstanding. While a source of additional capital, the announced warrants, if converted, will also increase the share count.Our outlook remains favorable. We are comfortable with our current top-line outlook. We believe the usage of ANJESO is increasing at a very strong rate, with additional formularies coming onboard and the pandemic issues subsiding. The proposed CDC opioid treatment guidelines, expected to be finalized by late 2022 or early 2023, provide additional support for the usage of ANJESO to manage post-surgical pain.Fourth quarter 2021 results yet to come. Baudax Bio has not yet reported 4Q 2021 results, but we believe the report, expected in the next few weeks, to show continued strong progress in ANJESO commercialization, providing support for the company valuation.Rating is Outperform but our price target is revised. Our top-line outlook remains intact but our adjusted share count affects our one-year target. Our 2027 EPS moves from $5.61 to $3.55. Our one-year price target, discounting 2027 EPS 30% and applying a 20x multiple, moves to $19.00. Read More >>