Foghorn Therapeutics adjusts ATM offering to $100M

CAMBRIDGE, MA – Foghorn Therapeutics Inc . (NASDAQ:FHTX), a pharmaceutical company with a market capitalization of $231.35 million, has announced an amendment to its common stock sales agreement with TD Securities (USA) LLC, effectively reducing the potential sale of shares in its at-the-market (ATM) offering. The amendment, which took place today, scales back the available shares from $200 million to $100 million.

The ATM program allows for the sale of common stock from time to time, as permitted by law. This strategic move modifies the original agreement dated April 15, 2022, but does not alter any other terms. The reduction in the sales cap indicates a shift in the company’s financing strategy, particularly notable as InvestingPro data shows the company is quickly burning through cash, despite maintaining a strong liquidity position with a current ratio of 3.73.

The securities offered through this ATM program are part of a shelf registration statement that was filed on January 24, 2025, and became effective on January 31, 2025. The offering is subject to a prospectus supplement filed today.

The adjusted offering is likely a response to market conditions or the company’s current capital requirements. It is important to note that this report does not suggest an immediate sale of shares but rather defines the parameters within which sales can occur.

Foghorn Therapeutics specializes in pharmaceutical preparations and operates under the industrial classification code 2834. The company is incorporated in Delaware and has its principal executive offices in Cambridge, Massachusetts.

This announcement is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities. The sale of common stock under the ATM program will be conducted in accordance with the registration statement and applicable state securities laws.

Investors and stakeholders in Foghorn Therapeutics will be watching closely to see how this amendment influences the company’s financial flexibility and growth strategy moving forward. The stock currently trades near its 52-week low of $3.86, having declined over 55% in the past six months. InvestingPro analysis suggests the stock is currently undervalued, with additional insights available through the comprehensive Pro Research Report, which provides deep-dive analysis of over 1,400 US stocks.

In other recent news, Foghorn Therapeutics reported several noteworthy developments. The company received a compliance notice from Nasdaq due to a shortfall in its audit committee following the resignation of Dr. Adam M. Koppel from the board of directors. This resignation left the audit committee with only two qualified members, prompting Nasdaq to issue a notice. Foghorn has been granted a grace period to rectify this situation by appointing a new independent member to the committee.

In addition, analysts from H.C. Wainwright and B.Riley have expressed confidence in Foghorn’s prospects. H.C. Wainwright maintained a Buy rating with a $13 price target, emphasizing the potential of Foghorn’s FHD-909, which is currently in a Phase 1a/b study. B.Riley also initiated coverage with a Buy rating and a $10 price target, noting the significant market opportunity in targeting SMARCA2 mutations in cancers. Despite a recent decline in stock due to the discontinuation of another product, FHD-286, analysts view this as a favorable buying opportunity.

Furthermore, Foghorn announced that Dr. Koppel’s resignation was not due to any disagreement with the company’s operations or policies. The company is actively working to ensure compliance with Nasdaq’s audit committee requirements within the stipulated timeframe. These recent developments highlight the ongoing strategic and operational adjustments at Foghorn Therapeutics.

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