REHOVOT, Israel - Steakholder Foods Ltd. (NASDAQ:STKH), a company specializing in 3D-printed meat and fish technology, has announced a change in the ratio of its American Depositary Shares (ADSs) to ordinary shares. The new ratio, effective April 4, 2024, will be one ADS for every one hundred ordinary shares, modifying the current one-to-ten ratio.
The ratio adjustment will act as a one-for-ten reverse ADS split for holders, with no action required on their part. The Bank of New York Mellon (NYSE:BK), the depositary bank for Steakholder Foods' ADS program, will manage the exchange of the existing ADSs for the new ratio on the effective date.
Arik Kaufman, CEO of Steakholder Foods, stated the adjustment aims to attract a wider range of investors, aiming for lower volatility and better liquidity, while maintaining compliance with Nasdaq's listing requirements. No new ADSs will be issued in this process, and fractional shares resulting from the adjustment will be sold, with proceeds distributed to the ADS holders.
This move follows a notification from the Nasdaq Stock Market on October 31, 2023, concerning the company's non-compliance with minimum bid price requirements. Steakholder Foods anticipates the adjustment will result in a proportional increase in the price of its ADSs, potentially meeting Nasdaq's criteria, although it acknowledges that future price performance cannot be assured.
Steakholder Foods is known for its proprietary 3D printers and printing materials, which are used to produce plant-based food that closely mimics the taste, texture, and appearance of traditional meat and seafood. The company is also working on developing cultivated cells for future integration into its product offerings.
InvestingPro Insights
As Steakholder Foods Ltd. (NASDAQ:STKH) embarks on its strategic move to adjust the ADS-to-ordinary share ratio, investors are closely monitoring the company's financial health and stock performance. According to InvestingPro data, Steakholder Foods currently holds a market capitalization of just 0.41 million USD. This relatively small market cap reflects the company's status within the highly competitive food technology sector.
The company's financial performance metrics offer additional insights, with an adjusted price-to-earnings (P/E) ratio over the last twelve months as of Q2 2023 standing at -0.02, indicating the company is not currently profitable. Furthermore, the price/book ratio as of the same period is 0.59, which could suggest that the stock is trading below its net asset value, though this metric alone does not provide a complete picture of the company's valuation.
InvestingPro Tips for Steakholder Foods highlight some challenges and risks that investors should consider. For instance, the company has been quickly burning through cash, which could be a concern for its long-term financial sustainability. Additionally, the stock has experienced significant price volatility, which aligns with the CEO's comments on aiming for lower volatility in the future. With these factors in mind, investors can use the InvestingPro platform to access a broader range of insights, including a total of 15 additional InvestingPro Tips for a more comprehensive analysis of Steakholder Foods. To take advantage of these insights, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
As the company looks to the future, including the development of cultivated cells, these financial metrics and tips from InvestingPro could help investors make more informed decisions about the potential risks and opportunities associated with Steakholder Foods.
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