NEW YORK - Delcath Systems, Inc. (NASDAQ:DCTH), a specialist in interventional oncology treatments, has confirmed the sale of common stock and pre-funded warrants in a private placement deal, expected to generate approximately $7 million in gross proceeds. The transaction involves accredited investors, including Delcath executives and board members.
The company will issue 876,627 shares at $3.72 each and provide certain investors with 1,008,102 pre-funded warrants at $3.71 per warrant. These warrants, exercisable at $0.01 per share, can be activated immediately and are valid until used in full.
Delcath's leadership has earmarked the net proceeds for working capital and other corporate needs. The private placement is poised for completion on March 19, 2024, pending customary closing conditions.
Delcath Systems is known for its proprietary products, including the HEPZATO KIT (melphalan for injection with Hepatic Delivery System) and CHEMOSAT Hepatic Delivery System for Melphalan, which are designed to deliver high-dose chemotherapy to the liver while minimizing systemic exposure.
The information in this article is based on a press release.
InvestingPro Insights
As Delcath Systems, Inc. (NASDAQ:DCTH) navigates the capital markets with its recent private placement deal, insights from InvestingPro bring to light several financial metrics and analyst perspectives that may interest investors. The company's market capitalization stands at a modest $90.17 million, reflecting its position in the biotech sector. Notably, Delcath's cash position appears to be strong, as it holds more cash than debt, which is a positive sign for investors considering the company's financial stability.
However, Delcath's financial health is not without its concerns. The company's revenue has shown a significant decline, with a -48.3% change over the last twelve months as of Q3 2023. This is compounded by a quarterly revenue growth of -52.1% in Q3 2023, indicating potential challenges in sales generation. Moreover, Delcath's operating income margin was deeply negative at -1604.3% for the same period, highlighting the substantial costs associated with its operations relative to its revenue.
In terms of stock performance, Delcath has had a strong return over the last three months, with a 16.61% price total return, which may catch the eye of momentum investors. However, InvestingPro Tips suggest caution, as analysts have revised their earnings downwards for the upcoming period and do not anticipate the company to be profitable this year. Additionally, the Relative Strength Index (RSI) indicates that the stock is currently in oversold territory, which could either signal a buying opportunity or reflect ongoing market skepticism.
Investors interested in a deeper analysis can find a wealth of additional insights on Delcath Systems at InvestingPro. There are currently 12 more InvestingPro Tips available for Delcath, providing a more comprehensive understanding of the company's prospects. To access these insights, use the coupon code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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