Channel Therapeutics announces 10-for-1 reverse stock split

FREEHOLD, N.J. - Channel Therapeutics Corporation (NYSE American:CHRO), currently trading at $1.17 with a market capitalization of $7.72 million, announced a 10-for-1 reverse stock split of its common stock, scheduled to take effect before market open on July 1, 2025. According to InvestingPro analysis, the stock appears overvalued at current levels despite showing strong momentum with an 86% price return over the past six months.

The company’s stock will begin trading on a split-adjusted basis on July 2, 2025, under the name Pelthos Therapeutics Inc. while maintaining the CHRO ticker symbol temporarily. Upon completion of its previously announced merger with LNHC, Inc., the ticker will change to PTHS. InvestingPro data reveals concerning financial health metrics, including a weak current ratio of 0.18, indicating potential liquidity challenges ahead of this corporate transformation.

The reverse split will reduce Channel’s outstanding shares from approximately 6.5 million to about 648,501 shares. Each stockholder’s percentage ownership in the company will remain unchanged, with any fractional shares rounded up.

According to the company’s statement, the reverse split aims to increase the market price per share and help Channel meet NYSE American initial listing requirements in connection with its pending merger and related $50 million capital raise from investors led by Murchinson. This capital injection comes at a crucial time, as InvestingPro analysis indicates the company faces significant financial challenges, with short-term obligations exceeding liquid assets. Subscribers to InvestingPro can access 5 additional key insights about CHRO’s financial position.

Channel stockholders approved the potential for a reverse split at a ratio between 5-for-1 and 25-for-1 during an April 16 meeting, with the board ultimately selecting the 10-for-1 ratio.

The biotechnology company focuses on developing non-opioid, non-addictive pain treatments, with its clinical research targeting the sodium ion-channel NaV1.7 for various pain conditions.

Stockholders holding shares in book-entry form or through brokers require no action regarding the split. Those with questions can contact Nevada Agency and Transfer Company, the company’s transfer agent, at (775) 322-0626.

Additional information about the reverse split is available in the company’s Definitive Information Statement filed with the SEC on May 27, 2025, based on the press release statement.

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