BioTech

Biostage Inc (NASDAQ:BSTG) Stock Drops on Financial Results

Biostage Inc (NASDAQ:BSTG)

Biostage Inc (NASDAQ:BSTG) stock dropped after the biotechnology company posted a second quarter financial report that disappointed investors. BSTG stock ended last Friday at $0.51 and closed at $0.44 for a 14% loss. Volume was more than double the listed average.

Biostage Inc (NASDAQ:BSTG)
One month stock chart for BSTG

Holliston, MA-based Biostage Inc (NASDAQ:BSTG) reported a Q2 2017 net loss of approximately (-$3.6) million, or a per share net loss of (-$0.10). In Q2 2016, Biostage reported a net loss of approximately (-$2.7) million, or (-$0.17) per share. The $0.9 million increase is largely due to increased R&D spending on outsourced preclinical studies and $1.0 million in employee expenses.

Holliston, MA-based Biostage Inc (NASDAQ:BSTG) is a biotechnology company that seeks to develop bioengineered organ implants based on the Company’s proprietary Cellframe™ technology. Cellframe technology combines a proprietary biocompatible scaffold with the patient’s own stem cells to create Cellspan organ implants, essentially re-growing the patient’s own organs. Cellspan implants are being developed to treat life-threatening conditions of the esophagus, bronchus, or trachea with the hope of dramatically improving a petient’s treatment outcomes. Based on preclinical data, Biostage selected life-threatening conditions of the esophagus as the initial clinical application of its technology.

On May 4, 2017, the Cellspan Esophageal Implant was surgically implanted into a 75-year old male with a life-threatening cancerous mass in his chest. The surgery was required to address the tumor’s encroachment on the patient’s lung, heart, and esophagus. The portion of the esophagus affected by the cancer was removed and the Cellspan Esophageal Implant was utilized to reconstruct the esophagus. The patient is now alive three months after surgery. Biostage believes that the Cellspan Esophageal Implant has performed as designed.

While BSTG shares are down YTD by over 42%, they have been in an uptrend since the end of June when the above procedure was made public. Accordingly, BSTG shares are up over 60% for the quarter and more than double their 52-week low of $0.22. The analyst’s consensus target price of the stock is $3.00.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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