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SAN CARLOS, CA - Allakos (NASDAQ:ALLK) Inc., a biopharmaceutical company, has been notified of non-compliance with Nasdaq's minimum bid price requirement, which could potentially lead to the delisting of its common stock from the Nasdaq Global Select Market. The notification, received on Monday, indicated that Allakos' stock had closed below the minimum $1.00 per share bid price for 30 consecutive business days.
The company, headquartered in San Carlos, California, has been given a 180-day period until February 10, 2025, to regain compliance with the bid price rule. During this time, Allakos' shares will remain listed on Nasdaq, contingent upon meeting other listing criteria.
To address the issue, Allakos' stock must maintain a minimum closing bid price of $1.00 for at least ten consecutive business days. If compliance is not achieved within the initial 180-day period, Allakos may be granted a second 180-day period to meet the requirement by transferring to the Nasdaq Capital Market, subject to certain conditions including a potential reverse stock split.
The company has expressed its intention to monitor its share price closely and explore options to rectify the deficiency and satisfy Nasdaq's listing standards. Despite these efforts, there is no guarantee that Allakos will be able to regain or maintain compliance with the bid price rule or other Nasdaq standards.
The information disclosed is based on a press release statement filed with the Securities and Exchange Commission.
In other recent news, Allakos Inc . has maintained its Hold rating from TD Cowen, following the release of Phase I study results for its investigational drug IV AK006. The drug showed over 90% receptor occupancy on mast cells at 29 days, and favorable safety was indicated in the results. Further evaluations of IV AK006 are currently being conducted by Allakos in chronic spontaneous urticaria (CSU) patient cohort, with data from approximately 30 patients expected by year's end.
Piper Sandler has also maintained its Overweight rating for Allakos, given the promising Phase 1 clinical data for AK006. The drug demonstrated strong safety and tolerability, as well as promising pharmacokinetics, with a 21-day half-life at the 720 mg intravenous dose.
Allakos reported a higher-than-expected net loss of $71 million in the first quarter of 2024, primarily due to a non-cash impairment charge, but maintains financial stability with $139 million in cash reserves, projected to sustain operations until mid-2026.
JMP Securities analysts have maintained a 'MARKET OUTPERFORM' rating for Allakos, citing the potential of AK006 to differentiate itself from competitors.
These are the recent developments within the company.
InvestingPro Insights
Allakos Inc. is navigating through a challenging period as it faces the risk of delisting from the Nasdaq Global Select Market. While the company seeks strategies to comply with Nasdaq's bid price rule, a glance at real-time data from InvestingPro reveals a market capitalization of just $58.42 million, reflecting a small-cap status that may appeal to certain investors. The stock's performance has been underwhelming, with a price that is currently a mere 19.32% of its 52-week high, and it closed the previous session at $0.66, well below the Nasdaq's $1.00 threshold.
InvestingPro Tips suggest that Allakos holds more cash than debt, which could be a silver lining in its financial stability. However, the company is quickly burning through its cash reserves, and analysts are not optimistic about its profitability in the near term. With the company's stock having fared poorly over the last month—evidenced by a 21.68% drop in its 1-month price total return—and trading near its 52-week low, investors should exercise caution. For those interested in a deeper analysis, InvestingPro offers additional tips on Allakos, providing a comprehensive understanding of the company's financial health and market position.
It's important to note that while Allakos has liquid assets that exceed its short-term obligations, its weak gross profit margins and significant price decline over the past year (-82.28% 1-year price total return) raise concerns about its operational efficiency and market sentiment. The company's valuation also implies a poor free cash flow yield, which may deter investors looking for companies with strong cash generation potential. For further insights and tips on Allakos, readers can explore the full suite of analyses available on InvestingPro.
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