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In a challenging market environment, Recursion Pharmaceuticals Inc. (RXRX) stock has touched a 52-week low, dipping to $5.5. This significant downturn reflects a broader trend for the biotech firm, which has seen its shares plummet by 41.7% over the past year. According to InvestingPro data, despite holding more cash than debt on its balance sheet, the company is quickly burning through its resources. The stock currently trades below its Fair Value, suggesting potential upside opportunity. Investors have been cautious as the company navigates through a complex landscape of drug development and regulatory hurdles. The 52-week low serves as a stark indicator of the volatility and risks inherent in the biotech sector, particularly for companies like Recursion that are in the process of researching and developing new medical treatments. Recent InvestingPro analysis reveals three analysts have revised their earnings downwards, though revenue grew by 32% in the last twelve months. Get access to 10+ additional ProTips and comprehensive analysis in the Pro Research Report.
In other recent news, Recursion Pharmaceuticals reported fourth-quarter revenues of $4.5 million, which was a 57% decrease year-over-year and fell short of Cowen’s $19 million projection. The company also posted a loss of $0.53 per share for the quarter, wider than the $0.41 loss analysts had forecasted. For the full year 2024, Recursion generated revenue of $58.8 million, up from $44.6 million in 2023, driven by a $30 million payment from Roche and Genentech. The company’s research and development expenses increased by 30% year-over-year to $98 million, with general and administrative expenses rising by 61% to $77 million due to costs related to its merger with EXAI. Despite these higher expenses, Recursion’s management anticipates more than $100 million in run-rate synergies from the merger, which are expected to be realized by 2025. Analyst Brendan Smith from TD Cowen maintained a Hold rating on Recursion’s shares, citing potential benefits from the merger and forthcoming data from key drug trials. The company highlighted early promising efficacy data for clinical programs REC-617 and REC-994 and initiated new clinical studies. Recursion ended the year with $603 million in cash and equivalents and expects its cash runway to extend into 2027.
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