Small-cap maker of cancer tests VolitionRx jumps after direct offering

On Friday, December 6, quotes on VolitionRx, a small-cap company that develops and sells early-detection tests for serious diseases, jumped almost 10% following the announcement of a registered direct offering priced at the previous day’s close.

Details

On Friday, VolitionRx stock jumped almost 10% on the NYSE to $0.63 per share. Earlier in the day, the company announced it had entered into agreements to sell 445,600 shares to insiders and nearly 2.9 million shares, along with the same number of five-year Form A warrants and 1.4 million five-year Form B warrants, to other investors in a direct offering. The shares and the Form A warrants were priced at $0.57 apiece, while the Form B warrants were set at $0.71 apiece. On Thursday, December 5, the day before the offering was announced, VolitionRx closed at $0.57 per share.

The offering, set to close today, Monday, December 9, is expected to raise $1.9 million, with up to an additional $2.7 million if the warrants are exercised. The company plans to use the proceeds for research and development and for working capital. Recall that back in August, it completed a $7 million direct offering.

About VolitionRx

Through its subsidiaries, VolitionRx produces and sells early-detection tests to help diagnose diseases in both humans and animals. One of its products, Nu.Q, underpins its veterinary cancer tests and those for detecting NETosis — a form of cell death found in patients with sepsis, cancer, and other conditions. According to the company, this test can detect epigenetic changes before a standard biopsy and before the appearance of initial symptoms.

For the third quarter of 2024, VolitionRx reported $475,000 in revenue, up 187% year over year, and $5.4 million in operating expenses, down 36%. The company aims to be cash-flow neutral next year. Most of its revenue comes from sales of its veterinary tests, as noted by Zacks Small-Cap Research (Zacks SCR). This year, VolitionRx also secured distribution agreements with Fujifilm Vet Systems, VetLab Poland, and Heska. In most regions, sales began in the third quarter.

Stock performance

Since the start of the year, VolitionRx stock is off almost 13%. According to MarketWatch, out of the three analysts covering the company, two have a “buy” recommendation, while one rates it a “hold.” Their average target price of $3.34 per share implies upside of more than 420% versus the last closing price.