Tonix Pharmaceuticals Holding Corp (NASDAQ: TNXP) is having an incredibly rough start to the trading session in the pre-market hours this morning. After digging into the news, you’ll see that the company hasn’t issued any press releases. So, what’s the deal? The declines seem to surround an offering of common stock. Today, we’ll talk about:
- The offering;
- What we’re seeing from TNXP stock as a result; and
- what we’ll be watching for ahead.
TNXP Announces Offering
As mentioned above, Tonix Pharmaceuticals is having an incredibly rough start to the trading session in the pre-market hours this morning. While the company has released no news, we did find an interesting SEC filing that seems to be the reason for the declines.
A search for TNXP on the SEC website will yield an S-1 filing in the results. Unfortunately, S-1 filings are filings related to offerings of common stock. In this particular case, the S-1 shows that TNXP plans on raising approximately $12 million in the offering of shares to the public.
As we know, public offerings of common stock are dilutive transactions. Essentially, the company will issue shares, generally at a steep discount, in an attempt to raise funds. Unfortunately, these funds raised ultimately decrease the value of shares held by existing shareholders.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of Tonix Pharmaceuticals, the news was anything but positive. After all, dilution is never a good thing. So, it comes as no surprise that upset investors are sending the stock spiraling down in the market this morning. Of course, our partners at Trade Ideas were the first to alert us to the declines. At the moment (9:05), TNXP is trading at $0.86 per share after a loss of $0.18 per share or 17.31% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on TNXP. In particular, we’re interested in following the story surrounding the company’s coming offering. While no PR has been issued about it yet, the company is likely to issue one, explaining the need for funding. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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