Please ensure Javascript is enabled for purposes of website accessibility

Why Celcuity Stock Is Crashing Today

By Keith Speights - Jun 29, 2021 at 11:11AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The clinical-stage biotech announced the pricing of a secondary stock offering.

What happened

Shares of Celcuity (CELC 1.33%) were crashing 19.3% lower as of 10:54 a.m. EDT on Tuesday. The big decline came after the biotechnology company announced the pricing of a secondary stock offering.

So what

It's not surprising in the least that the biotech stock fell hard today. Celcuity plans to issue 2.25 million new shares at a price of $25 per share. Not coincidentally, the company's share price dropped to around that level.

Nor is it surprising that Celcuity decided to conduct a secondary stock offering. Its share price had soared nearly 240% prior to today. Companies like to issue new shares when their stocks are trading near highs because they're able to set the price tag at a higher level.

Two scientists in a lab with one scientist looking through a microscope.

Image source: Getty Images.

The good news is that Celcuity expects to raise around $56.25 million in gross proceeds from the stock offering. The company intends to use this money for various purposes, potentially including funding its clinical trials and research and development.

Now what

The main thing to watch with Celcuity now is its pipeline progress. The company expects to soon enroll patients in a phase 2 study evaluating its CELsignia diagnostic test with Pfizer's Vizimpro and Xalkori. Interim results from this study should be available in the second half of 2022. Celcuity also hopes to begin a phase 2/3 clinical study evaluating gedatolisib in treating breast cancer in the first half of next year. 

Keith Speights owns shares of Pfizer. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Celcuity Inc. Stock Quote
Celcuity Inc.
$10.64 (1.33%) $0.14
Pfizer Inc. Stock Quote
Pfizer Inc.
$48.29 (-3.32%) $-1.66

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/11/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.