Today, shares of Florida-based fertility company INVO Bioscience soared, tripling in early trading after the firm announced a reverse merger with private oncology and regenerative-medicine company, NAYA Biosciences. The surge, while impressive, leaves INVO's share price still over 90% below its 52-week high of $25.40, according to InvestingPro data.
The post-merger structure will see INVO shareholders retain 12% of the new entity, while NAYA investors will hold a dominant 88%. The merger significantly boosts INVO's market capitalization from a modest $1.33 million to approximately $12.4 million, marking a substantial three-and-a-half-fold increase. This is a notable increase, but it's worth mentioning that the company's market cap is still relatively small, with an adjusted figure of $116.85 million according to InvestingPro metrics.
The deal values NAYA at nearly $91 million and the combined company will operate under the NAYA name. The completion of the merger is anticipated by the end of this year. Despite today's impressive rally, investors will be keeping a close eye on how the newly formed company performs in the coming months. This is especially true given some of the InvestingPro Tips for INVO, which includes the fact that the company is quickly burning through cash and analysts do not anticipate the company will be profitable this year.
The InvestingPro Tips also highlight that INVO's stock has taken a significant hit over the last six months, with a 45.45% decline, and the price is still 19.39% of its 52-week high. The company's P/E ratio is at -0.68, indicating that the company is not generating profits at the moment. For those interested in more such insights, there are 13 additional tips listed on the InvestingPro platform.
Investors will be closely monitoring the company's revenue growth and gross profit margins. The recent data shows a revenue growth of 354.99% but a gross profit margin of -1242.32%, indicating a significant loss. Given these figures and the company's current financial situation, it's clear that the new entity has some challenges to overcome in the near future.
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