SAN DIEGO - TRACON Pharmaceuticals (NASDAQ: NASDAQ:TCON), a clinical-stage biopharmaceutical company, has approved a reverse stock split of its common stock at a ratio of one-for-twenty, set to take effect at 5:00 p.m. ET on April 9, 2024. Starting April 10, 2024, the company's shares will trade on a split-adjusted basis on the Nasdaq Capital Market under the ticker symbol TCON, with a new CUSIP number 89237H308.
The reverse stock split, previously approved by stockholders on September 6, 2023, will consolidate every 20 shares of issued and outstanding common stock into one share, with the par value remaining at $0.001 per share. Post-split, approximately 2.6 million shares of common stock will be issued and outstanding. This action is intended to increase the market price per share of TRACON's common stock, making it more attractive to investors and potentially improving trading liquidity.
Stock options and warrants outstanding before the reverse stock split have been adjusted accordingly. No fractional shares will be issued; stockholders who would otherwise hold a fractional share will receive one full share of post-split stock. Equiniti Trust Company (EQ) has been chosen as the exchange agent for the split. Stockholders with shares held through banks, brokers, or nominees will see their holdings automatically adjusted to reflect the reverse stock split and do not need to take any additional actions.
TRACON specializes in advancing a pipeline of targeted cancer therapeutics and partnering with other life science companies. Their clinical-stage pipeline includes treatments such as Envafolimab, a PD-L1 single-domain antibody; YH001, a CTLA-4 antibody; and TRC102, a small molecule drug for lung cancer treatment. The company aims to expand its partnerships through profit-share or revenue-share agreements or by franchising its product development platform.
This announcement is based on a press release statement.
InvestingPro Insights
In light of TRACON Pharmaceuticals' recent decision to implement a reverse stock split, current and prospective investors may be evaluating the company's financial health and market position. According to the latest metrics from InvestingPro, TRACON holds a market capitalization of $11.62 million USD. This relatively small market cap reflects the high-risk, high-reward nature typical of clinical-stage biopharmaceutical companies.
InvestingPro Data also reveals a negative P/E ratio of -2.33, indicating that the company is not currently profitable—a common scenario for firms in the development phase of new therapeutics. Additionally, the company's gross profit margin stands at -1.93% for the last twelve months as of Q4 2023, suggesting challenges in generating profit from its revenues.
Despite these challenges, InvestingPro Tips highlight a few potential silver linings for TRACON. The company holds more cash than debt on its balance sheet, which can be a positive sign of financial stability. Moreover, analysts anticipate sales growth in the current year, which could signal a turning point for the company if its pipeline products progress favorably.
Furthermore, TRACON's stock has experienced a significant price uptick over the last six months, with a 52.69% total return, reflecting positive investor sentiment in the short term. However, it is important to note that the stock has shown high price volatility, which is an essential consideration for investors with different risk appetites.
For those interested in a deeper analysis, InvestingPro offers additional insights and metrics for TRACON Pharmaceuticals, which could be particularly valuable in light of the upcoming reverse stock split. Investors can find more InvestingPro Tips on https://www.investing.com/pro/TCON and can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, providing access to a total of 17 InvestingPro Tips for a comprehensive investment strategy.
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