FREEHOLD, N.J. - Chromocell Therapeutics Corporation (NYSE American: CHRO), a biotech firm specializing in non-opioid pain treatments, announced today that its board of directors has approved an amendment to increase its stock repurchase plan. The amendment allows for an additional $500,000 in common stock buybacks, raising the total repurchase value to $750,000 and extending the plan's termination date to June 30, 2025.
The company's CEO, Frank Knuettel, stated that the decision to enhance the repurchase plan reflects their belief in the undervaluation of Chromocell's stock and their view that it represents an attractive investment opportunity at its current price.
Chromocell may buy back shares through open market transactions or privately negotiated deals, adhering to the Securities Exchange Act of 1934's Rule 10b-18 and other legal requirements. The execution of these repurchases, including timing and volume, remains at the company's discretion and will depend on stock availability, market conditions, trading prices, alternative capital uses, financial performance, and securities laws compliance.
The company also indicated that some repurchases might occur under Rule 10b5-1 trading plans, which allow stock buybacks at times when the company might otherwise be restricted from such actions.
Chromocell Therapeutics focuses on developing non-addictive treatments for various types of pain by targeting the NaV1.7 sodium ion-channel. However, the company cautions that there are no assurances regarding the amount of stock that will be repurchased.
This announcement includes forward-looking statements, which are not guarantees of future performance and involve risks and uncertainties. The company notes that the trading price of their common stock may not necessarily reflect its value or become a more attractive investment in the future. Further details on these risks are available in the company's filings with the U.S. Securities and Exchange Commission.
The information in this article is based on a press release statement from Chromocell Therapeutics Corporation.
In other recent news, Chromocell Therapeutics Corporation has announced a stock repurchase plan worth up to $250,000. This initiative, approved by the board of directors, represents approximately 23% of the company's non-affiliate float. It's important to note that this program does not obligate the company to buy a specific number of shares and may be modified or halted at any time.
CEO Frank Knuettel II has expressed confidence in the company's ongoing drug development efforts and sees the undervalued stock as a potential investment opportunity. Chromocell is also planning to make further announcements soon highlighting their progress in developing treatments for neuropathic and chronic pain.
The stock repurchases will take place intermittently in the open market or through private transactions, following legal guidelines. The company's management will determine the volume and timing of purchases based on factors such as stock availability, market conditions, and the company's financial performance. These are the recent developments in Chromocell Therapeutics Corporation.
InvestingPro Insights
Chromocell Therapeutics Corporation's decision to expand its stock repurchase plan comes at a time when the company's financial metrics and market performance paint a challenging picture. According to InvestingPro data, CHRO's market capitalization stands at a modest $3.88 million, reflecting its current position in the biotech sector.
The company's stock has experienced significant downward pressure, with InvestingPro Tips highlighting that the price has fallen substantially over the last year, three months, and even in the past week. This aligns with the company's view that its stock is undervalued, potentially justifying the increased buyback program.
However, investors should note that CHRO faces some financial hurdles. An InvestingPro Tip indicates that the company is not profitable over the last twelve months, and analysts do not anticipate profitability this year. This is further evidenced by the negative gross profit of $2.82 million and an adjusted operating income of -$8.87 million for the last twelve months as of Q2 2023.
Despite these challenges, Chromocell holds more cash than debt on its balance sheet, which could provide some financial flexibility as it pursues its development of non-opioid pain treatments. This cash position may also support the expanded stock repurchase plan.
For investors seeking a more comprehensive analysis, InvestingPro offers additional insights with 8 more tips available for CHRO, which could provide a deeper understanding of the company's financial health and market position.
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