What Made H.C. Wainwright Downgrade Tetraphase’s Stock?

H.C. Wainwright analyst Ed Arce downgraded Tetraphase (TTPH) to Hold today. The company’s shares closed last Monday at $0.26, close to its 52-week low of $0.23.

Arce noted:

“We note that the company still had several months remaining in the interest-only (IO) payment period of the loan, which was set to expire on February 1, 2020 (before any potential extensions for meeting certain revenue and other conditions). Pursuant to the payoff letter to the lenders, the full amount paid represents: (a) $30M principal; (b) about $237k in interest (for at one-month LIBOR rate (August average is about 2.18%) + 7.25%; and (c) $480k final fee, representing 1.6% of principal (reduced from 4.0% originally). In addition, the 3.0% prepayment penalty fee was waived. Further, the lenders retain an aggregate of 414,365 10- year warrants at a $2.17 strike price. Tetraphase had $71.0M in total cash as of June 30, and expects a $2M up-front payment from partner Everest Medicines (private) in August.”

According to TipRanks.com, Arce is a 4-star analyst with an average return of 7.3% and a 34.6% success rate. Arce covers the Healthcare sector, focusing on stocks such as Entasis Therapeutics Holdings Inc, Madrigal Pharmaceuticals Inc, and Arcturus Therapeutics Ltd.

Tetraphase has an analyst consensus of Hold.

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The company has a one-year high of $3.56 and a one-year low of $0.23. Currently, Tetraphase has an average volume of 568.6K.

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Tetraphase Pharmaceuticals, Inc. is engaged in the development and production of novel antibiotics for serious and life-threatening bacterial infections. It is currently developing a product candidate, eravacycline, a fully synthetic fluorocycline, as an intravenous and oral antibiotic for use as a first-line empiric monotherapy for the treatment of resistant and multi-drug-resistant infections. The company was founded on July 7, 2006 and is headquartered in Watertown, MA.

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