Aditxt (NASDAQ: ADTX) stock should rise 4,000% at the open. ADTX stock also rose 32% yesterday but these are two entirely and wholly different things. The 32% rise was a real price rise, one that fattened wallets. The 4,000% today will be a purely nominal rise as a result of a technical change. As we repeatedly point out we must not confuse real and nominal price changes - the distinction is vital.
The business is: “Aditxt, Inc., a biotech company, develops technologies focuses on improving the health of the immune system through immune mapping and reprogramming. The company develops AditxtScore that allows individuals to understand, manage, and monitor their immune profiles in order to be informed about attacks on or by their immune system; and Apoptotic DNA Immunotherapy, a nucleic acid-based technology that utilizes an approach that mimics the way the body naturally induces tolerance to its own tissues.” And nothing wrong in trying that. It’s just that they’re not very good at that trying. Sales seem to be flatlining around the $250k a quarter level while expenses mean there’s a loss of $5.5 to $6 million on that. There’s, to be very kind indeed about it, got to be some sales growth there to grow into that expense base.
Aditxt stock price from Google Finance
That bounce yesterday seems to be that the financial numbers weren’t even worse.
But this rather Sad Sack performance means that Aditxxt is in breach of the NASDAQ conditions. The American markets think that penny stocks are the preserves of fraud s and conmen - therefore to remain on the main exchanges you must maintain the $1 minimum bid price. Aditxt is failing to do this, obviously, so something must be done.
That something is to simply declare that what used to be 40 pieces of stock are now just the one. A one for 40 reverse share split: “Aditxt, Inc. (ADTX) will effect a one-for-forty (1-40) reverse split of its Common Stock. The reverse stock split will become effective on Friday, August 18, 2023.”
This does rather leave open the question of why they’d want to stay on NASDAQ. And the answer there is that the OTC, the next level down of the markets, has less liquidity and thus it’s much more difficult to raise capital. And our reading of the Aditxt accounts suggests that they’re going to want to raise some more capital real soon now. So, retaining the NASDAQ listing is important to them.
