On Friday, H.C. Wainwright adjusted its price target on Nyxoah SA (NASDAQ: NYXH) shares, a company specializing in treatments for obstructive sleep apnea (OSA), to $18 from the previous $22. Despite the reduction, the firm maintained a Buy rating on the stock.
The adjustment comes in the wake of Nyxoah's recent announcement regarding its public offering in the United States, which also includes a private offering to certain international investors.
Nyxoah has set the price of its offering at $9.25 per ordinary share, before underwriting discounts and commissions. The offering consists of 5,374,755 ordinary shares, with an additional 806,213 shares available for the underwriters to purchase if they exercise their 30-day option.
The company anticipates gross proceeds of around $50 million from this offering, not accounting for offering expenses or any additional funds from the underwriters' potential exercise of their option to purchase more shares. The closing of the offering is scheduled for on or about May 28, 2024.
The proceeds from this offering are earmarked for several key initiatives. Nyxoah plans to use the funds for pre-commercialization and commercialization efforts in the U.S. market, to support clinical data collection, and to assist physician-initiated clinical research on OSA treatments.
Additionally, the company aims to finance research and development of the next generation of their Genio system, expand their technology pipeline, and explore potential collaboration opportunities in monitoring and diagnostics for OSA. The capital is also intended for general corporate purposes.
H.C. Wainwright has revised its financial model for Nyxoah to reflect the impact of the capital raise. The firm anticipates that the proceeds will enable Nyxoah to reach commercialization stage, but also forecasts that another round of capital raising may be necessary in 2025. The decision to lower the price target to $18 reflects the potential dilution effects from the recent capital raise.
InvestingPro Insights
In light of the recent developments with Nyxoah SA, examining the company's financial health and stock performance through InvestingPro metrics offers additional insights. With a market capitalization of $248.76 million, Nyxoah's valuation reflects its position in the niche market of obstructive sleep apnea treatments. Notably, the company's revenue has seen a substantial increase of nearly 79% over the last twelve months as of Q1 2024, highlighting significant sales growth. This aligns with analysts' expectations of sales growth in the current year, which is a positive signal for potential investors.
The stock's performance, however, tells a contrasting story. Nyxoah's stock has experienced a sharp decline over the past three months, with a 51.06% drop, which may raise concerns. This is in addition to a significant price volatility, with a large uptick of 66.6% over the last six months and a year-to-date return of 79.53%. Despite this, the InvestingPro fair value estimate stands at $11.46, suggesting that the stock may currently be undervalued.
Two InvestingPro Tips to consider: Nyxoah is quickly burning through cash and analysts do not anticipate the company will be profitable this year. These factors are critical for investors to weigh against the company's growth prospects and recent capital raise. It's also worth noting that Nyxoah does not pay a dividend, which may influence the investment decisions of income-focused shareholders.
For those looking to delve deeper into Nyxoah's financials and future outlook, InvestingPro provides 12 additional tips to guide your investment strategy. Utilize coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and gain access to these valuable insights.
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