SAN JOSE, CA - Rani Therapeutics Holdings, Inc. has announced the appointment of Marcum LLP as its new independent registered public accounting firm, effective Monday. The decision was made by the Audit Committee of the company's Board of Directors on September 10, 2024, following the dismissal of Ernst & Young LLP (EY) from the same role.
The previous auditor's reports on Rani's financial statements for the fiscal years ending December 31, 2022, and December 31, 2023, did not contain any adverse opinion or modifications concerning audit scope or accounting principles. However, an explanatory paragraph in the 2023 report indicated substantial doubt about the company's ability to continue as a going concern.
Rani Therapeutics, which trades on The Nasdaq Stock Market LLC under the ticker NASDAQ:RANI, reported no disagreements with EY on matters of accounting principles, practices, financial statement disclosure, or auditing procedures during the fiscal years and interim period leading up to the change. There were also no reportable events as defined by the SEC regulations.
In compliance with SEC regulations, Rani Therapeutics provided EY with a copy of the disclosures made in response to the change in accountants. EY has agreed with the statements made by the company in a letter to the SEC dated September 11, 2024, which is attached as Exhibit 16.1 to the report.
In other recent news, Rani Therapeutics has been the subject of several significant developments. The company reported a Q2 net loss of $0.51 per share, in line with expectations, leading H.C. Wainwright to adjust its 12-month price target for the company from $13 to $9, while maintaining a Buy rating.
The company also secured approximately $10 million from a stock sale, involving the sale of 2.8 million shares of Class A common stock and pre-funded warrants for an additional 446,753 shares.
The company has also announced a collaboration with South Korean biotech firm, ProGen Co., Ltd., to co-develop and commercialize RT-114, an oral therapeutic for obesity.
The partnership will leverage Rani's RaniPill® capsule and ProGen's proprietary protein, PG-102, with both companies agreeing on a 50/50 cost and revenue share arrangement for global development and commercialization.
Stifel reaffirmed its Buy rating on shares of Rani Therapeutics, maintaining a steady price target of $10.00, following the company's recent collaboration with ProGen. On the other hand, Canaccord Genuity adjusted its financial outlook for the company, reducing its price target from $21.00 to $9.00 due to a shift in the clinical development timeline. Despite this, Canaccord Genuity maintained a Buy rating, indicating continued confidence in Rani Therapeutics' potential.
InvestingPro Insights
As Rani Therapeutics Holdings, Inc. navigates through its accounting firm transition, investors may find it beneficial to consider the company's financial health and market performance. According to InvestingPro data, Rani Therapeutics has a market capitalization of approximately $132.98 million. The company's Price / Book ratio as of the last twelve months leading up to Q2 2024 is notably high at 46.34, reflecting a premium market valuation relative to its book value. Furthermore, the company has experienced a strong return over the last month with a price total return of 15.93%.
InvestingPro Tips highlight several challenges facing the company, including a quick burn rate of cash and weak gross profit margins. These factors contribute to the analysts' consensus that Rani will not achieve profitability this year. Additionally, while the company operates with a moderate level of debt, it has not been profitable over the last twelve months. For investors seeking a dividend, it is important to note that Rani does not distribute dividends to shareholders.
For those interested in a deeper analysis, InvestingPro offers additional insights into Rani Therapeutics' financials and market performance, which can be found at https://www.investing.com/pro/RANI.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.