Why Shares of Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) Are Trading Up

Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP)

Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) underwent a 1:10 reverse stock split on March 27 in order to come into compliance with NASDAQ rules. The reverse split of TNXP common shares was necessary as they had traded under $1 for enough time that their continued listing was in danger due to NASDAQ Global Market rule 5450(a)(1). While Tonix’s ticker symbol, TNXP, will remain the same, the Cusip number was changed to 890260409. The split will also affect any common stock that will be issued through the exercise of any outstanding options or warrants.

It is with no small sense of irony that observers of Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) today witness TNXP shares up over 80% on the open of trading. Thanks to the reverse split, TNXP shares closed yesterday at $4.14. However, they opened at $7.75 before hitting their current inter-day high of $9.40. The rally was following a news release by Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) that it will present at The MicroCap Conference on April 4, 2017 in New York, NY. Had this announcement been made last week, it is not beyond speculation to think that the costs associated with the reverse split could have been avoided.

Seth Lederman, M.D., President and CEO of Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP), will provide a corporate update and an overview of Tonix’s posttraumatic stress disorder (PTSD) clinical program. TNX-102 SL* was recently granted Breakthrough Therapy designation by the U.S. Food and Drug Administration (FDA) for the treatment of PTSD. This month, Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) dosed the first patient for the “HONOR” study, a 12-week placebo-controlled Phase 3 clinical study evaluating TNX-102 SL 5.6 mg, in military-related PTSD. The interim analysis of the HONOR study is expected in the first half of 2018 and topline results are expected in the second half of 2018.

It is rare for the leadership of a clinical-stage pharmaceutical firm to provide a presentation in public unless the results have been favorable. Logically – who wants to listen to the results of a failed study? Or, even further, who would want to be the presenter? Certainly not the person at the top of the responsibility pyramid. So, it is normal for such an announcement to act as a catalyst for higher share prices on large volumes. And volumes are large today – over 88 times their normal trading average.

Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP), and their shareholders, could use the good news. In 2011 TNXP shares lost -$32.39 in EPS. The next year TNXP experienced an even larger EPS loss of -$55.80. The next two years had EPS losses of -$33.68 and -$27.66. For 2015 the EPS loss was -$28.62. Additionally there are no reported sales for the company and dilution has occurred every year. In 2011 there were 110,000 shares outstanding and that number grew YoY to a reported 1.68 million in 2015.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

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Marc has a degree in economics and a MSc. in Finance. Marc worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

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