PLEASANTON, Calif. - Movano Health (NASDAQ:MOVE), a healthcare solutions company, announced a 1-for-15 reverse stock split of its common stock, set to take effect at the start of trading on Tuesday, October 29, 2024. This action is aimed at boosting the company's stock price to satisfy Nasdaq's minimum bid price requirement and maintain its listing.
The reverse stock split was authorized by Movano Health's stockholders during the annual meeting on July 9, 2024, and the final terms were determined by the Board of Directors. As a result of the split, the number of outstanding shares will decrease from roughly 99.5 million to approximately 6.6 million. However, the total number of authorized shares will remain unchanged.
Stockholders will not need to take any action as the reverse stock split will automatically convert every 15 shares of existing common stock into one new share. Those holding fractional shares will receive a round-up to the nearest whole share. Adjustments will also be made to the exercise prices and number of shares underlying the company's equity plans.
Movano's transfer agent, Pacific Stock Transfer Company, will provide stockholders with a transaction notice detailing their post-split share count. Those holding shares through a broker or bank will see their accounts adjusted accordingly.
This financial maneuver is a strategic step by Movano Health, which was established in 2018 and is known for the Evie Ring, a device designed to offer medical-grade health data through wearables. The company is focused on translating health data into actionable insights.
The reverse stock split is part of Movano Health's efforts to adhere to Nasdaq's listing rules and reflects the company's ongoing commitment to its shareholders and the market. Further details can be found in the definitive proxy statement filed with the U.S. Securities and Exchange Commission on May 28, 2024. This article is based on a press release statement from Movano Health.
In other recent news, Movano Health is making significant strides in its operations, especially in the FDA's review process for its EvieMED Ring. The company is nearing the final phase of the FDA's 510(k) clearance process, particularly for the device's pulse oximetry feature. The EvieMED Ring, designed by Movano Health, integrates medical device features with wellness metrics tracking, aiming to support remote patient monitoring and clinical trials.
Movano Health also reported an operating loss of $6.4 million in the second quarter, despite shipping 1,837 Evie Rings. However, the company has established collaborations with two global pharmaceutical companies and a large payer, indicating potential commercial opportunities.
Furthermore, Movano Health has completed a blood pressure clinical study and is redesigning the device for improved sensor placement. These developments are part of the company's ongoing efforts to improve its operations and reach a broader market. Lastly, Movano Health is set to resume direct-to-consumer orders for its Evie Ring, introducing product enhancements and improved operational processes.
InvestingPro Insights
Movano Health's decision to implement a reverse stock split comes amid challenging financial circumstances, as revealed by recent InvestingPro data. The company's market capitalization stands at a modest $29.29 million, reflecting its current position in the healthcare solutions sector.
InvestingPro Tips highlight that Movano is "quickly burning through cash" and "not profitable over the last twelve months." These factors likely contributed to the need for the reverse stock split to maintain Nasdaq listing compliance. The company's financial struggles are further underscored by its negative gross profit margin of -87.21% and an alarming operating income margin of -3198.83% for the last twelve months as of Q2 2024.
Despite these challenges, an InvestingPro Tip notes that Movano "holds more cash than debt on its balance sheet," which could provide some financial flexibility as it navigates this period of restructuring. Additionally, the company's "liquid assets exceed short term obligations," potentially offering a buffer against immediate financial pressures.
The reverse stock split aims to address the significant stock price decline, with InvestingPro data showing a one-year price total return of -67.11% as of the most recent data. This aligns with another InvestingPro Tip indicating that the "stock has taken a big hit over the last six months."
Investors considering Movano Health should note that analysts, according to InvestingPro Tips, "do not anticipate the company will be profitable this year." This insight, along with 13 additional tips available on InvestingPro, can provide a more comprehensive view of Movano's financial health and market position.
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