PLEASANTON, Calif. - Movano Health (NASDAQ:MOVE), a health technology company, announced today that it is investigating potential manipulation of its stock following the recent reverse stock split. The company observed a high volume of single share transactions between the announcement of the reverse split on October 25, 2024, and its effective date on October 29, 2024, which appeared to be an attempt to exploit the rounding up of fractional shares.
John Mastrototaro, President and CEO of Movano Health, stated that the company is working closely with securities regulators and legal advisors to address this issue and protect shareholder interests. He also noted that similar patterns of manipulation have been identified in other small cap stocks following their respective reverse stock splits.
Movano Health anticipates that the total number of common shares outstanding will remain approximately 6.6 million after the reverse split, as the company detected the suspicious activity before any additional shares were issued. Further details about the reverse stock split can be found in the company's proxy statement for the annual stockholders' meeting held on July 9, 2024, available on the SEC's website and Movano Health's official site.
The company, established in 2018 and known for the Evie Ring, is focused on developing medical-grade wearable healthcare solutions. These devices are designed to provide comprehensive health data and insights for individual users and enterprises.
This press release also contains forward-looking statements regarding Movano Health's future plans and expected outcomes, including the commercial launch of their products and anticipated FDA clearances. However, the company cautions that these statements are based on current assumptions and are subject to risks and uncertainties that could cause actual results to differ.
Movano Health's investigation is ongoing, and the company is committed to full transparency throughout the process. This update is based on a press release statement from Movano Health.
In other recent news, Movano Health is nearing the final phase of the FDA's 510(k) clearance process for its EvieMED Ring, a wearable device that offers both wellness metrics and medical device functionality. The company has also resumed direct-to-consumer orders for the Evie Ring, following product enhancements and operational improvements. Despite an operating loss of $6.4 million in the second quarter, Movano Health shipped 1,837 Evie Rings and established collaborations with two global pharmaceutical companies and a large payer, signaling potential commercial opportunities. Additionally, Movano Health has completed a blood pressure clinical study and is redesigning the device for improved sensor placement. The company also announced a 1-for-15 reverse stock split to maintain its Nasdaq listing and has initiated an investigation into potential stock manipulation following the split. These recent developments underscore Movano Health's ongoing commitment to its operations and market expansion.
InvestingPro Insights
As Movano Health (NASDAQ:MOVE) grapples with potential stock manipulation, recent financial data from InvestingPro sheds light on the company's current position. The company's market capitalization stands at a modest $24.74 million, reflecting its small-cap status and potentially explaining its vulnerability to stock manipulation tactics.
InvestingPro data reveals that Movano Health's stock has faced significant headwinds, with a one-year price total return of -75.01% as of the latest available data. This substantial decline aligns with the company's ongoing challenges and the recent need for a reverse stock split.
Two key InvestingPro Tips are particularly relevant to Movano Health's situation. First, the company is "quickly burning through cash," which could be a concern for investors given the current investigation and market uncertainties. Second, analysts "do not anticipate the company will be profitable this year," underscoring the financial hurdles Movano Health faces as it develops its medical-grade wearable healthcare solutions.
These insights provide crucial context to the company's current predicament and its focus on protecting shareholder interests. Investors seeking a more comprehensive analysis can access additional tips and data through InvestingPro, which offers 11 more tips for Movano Health.
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