SUNNYVALE, Calif. - BioCardia Inc. (NASDAQ: NASDAQ:BCDA), a developer of therapeutics for cardiovascular and pulmonary diseases, has announced its intention to carry out a reverse stock split. The action, sanctioned by its stockholders and Board of Directors, aims to fulfill the Nasdaq Capital Market's minimum bid price condition for continued listing.
The reverse stock split is scheduled to be effective at the beginning of the trading day on May 30, 2024, with a ratio of 1 post-split share for every 15 pre-split shares. BioCardia's common stock and warrants will continue trading on the Nasdaq under the ticker symbols "BCDA" and "BCDAW," respectively.
This corporate maneuver will automatically convert every 15 shares of issued and outstanding common stock into one share. Shareholders using electronic book-entry form or those owning shares through a bank, broker, or other nominee will not be required to take any action as adjustments will be made automatically.
For shareholders with physical stock certificates, the company's transfer agent will provide instructions for exchanging those certificates for book-entry shares or new certificates representing the post-split share count. Moreover, cash payments will be issued in lieu of fractional shares based on the closing sale price of the common stock on May 29, 2024, as adjusted for the reverse stock split.
The reverse stock split will uniformly affect all shareholders and will not change any shareholder's percentage interest in BioCardia's equity, except in the case of fractional shares. Proportional adjustments will be made to the company's equity awards and warrants, including the number of shares issuable and the exercise or conversion price.
Following the split, the common stock will have a new CUSIP number, while the public warrants' CUSIP number will remain unchanged. The authorized shares of common stock will also be reduced from 100,000,000 to 50,000,000, with no change to the par value per share or the authorized shares of preferred stock.
The decision to implement a reverse stock split comes as a strategic move to boost the company's stock price above the Nasdaq's minimum requirement. However, BioCardia has cautioned that it cannot guarantee the post-split stock price will maintain the intended ratio, remain above the pre-split price, or stabilize for any period.
This announcement is based on a press release statement and further information regarding the reverse stock split can be found in BioCardia's definitive proxy statement filed with the SEC on April 15, 2024.
InvestingPro Insights
As BioCardia Inc. (NASDAQ: BCDA) prepares for its reverse stock split, investors are closely monitoring the company's financial health and market performance. According to recent data from InvestingPro, BioCardia's market capitalization stands at a modest 10.91 million USD, reflecting the challenges faced by the company in the competitive biotech sector.
InvestingPro Tips indicate that BioCardia is quickly burning through cash and suffers from weak gross profit margins. These factors are significant as the company's ability to generate profit is critical to its long-term sustainability and ability to meet Nasdaq's listing requirements. Moreover, with net income expected to drop this year and short-term obligations exceeding liquid assets, the financial stability of BioCardia remains a concern for potential investors.
Additional metrics show a stark revenue decline over the last twelve months as of Q1 2024, with a decrease of 65.49%. The gross profit margin during the same period was reported at an alarming -1550.85%, indicating that the company spends significantly more to produce its goods than it earns from sales. Furthermore, the company's P/E ratio stands at -0.85, underscoring the market's concerns about its profitability outlook.
For those considering investing in BioCardia, it's essential to note that the company does not pay dividends, which could be a deterrent for income-focused investors. However, for those interested in a more in-depth analysis, there are 10 additional InvestingPro Tips available for BioCardia, which can be accessed through InvestingPro's comprehensive platform at https://www.investing.com/pro/BCDA. To get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, use the coupon code PRONEWS24.
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