Company Update (NASDAQ:AMDA): Here’s Why Amedica Corporation Set to Open Lower


Amedica Corporation (NASDAQ:AMDA) shares are set to open lower this morning, under pressure from the news that the company intends to offer and sell common stock and warrants, subject to market and other conditions, in an underwritten public offering. The public offering would dilute shareholders’ investments

The common stock and warrants are being offered under the Company’s effective shelf registration statement previously filed with the Securities and Exchange Commission (SEC). Net proceeds from the offering will be used by Amedica to (1) remain in compliance with the financial covenants in its outstanding Loan and Security Agreement; (2) support working capital needs and other general corporate purposes; (3) fund research and development and commercialization activities of Amedica’s product candidates, including the funding of clinical trials Amedica plans to conduct for its product candidates; and (4) continue to build sales, marketing and distribution capabilities for Amedica’s silicon nitride technology platform and other products, including the costs of inventory and instruments.

On the ratings front, Maxim analyst Jason Kolbert reiterated a Buy rating on AMDA, with a price target of $5.00, in a report issued on November 23. The current price target implies an upside of 694% from current levels. According to TipRanks.com, Kolbert has a yearly average loss of 15.9%, a 28% success rate, and is ranked #4290 out of 4355 analysts.

Amedica Corp. operates as a commercial biomaterial company that focuses on using its silicon nitride technology platform to develop, manufacture and sell a broad range of medical devices. It currently markets spinal fusion products and are developing products for use in total hip and knee joint replacements. The company market a complementary line of non-silicon nitride spinal fusion products which allows it to provide surgeons and hospitals with a broader range of products. These products include three lines of spinal fusion devices and five types of orthobiologics, which are used by surgeons to help promote bone growth and fusion in spinal fusion procedures.

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