Dynavax Technologies Corporation (DVAX) Dips on Share Dilution

After market close, Dynavax Technologies Corporation (NASDAQ:DVAX) announced that it intends to offer and sell $125.0 million of shares of its common stock, subject to market and other conditions, in an underwritten public offering. Dynavax also expects to grant the underwriters a 30-day option to purchase up to an additional $18.75 million of shares of its common stock to cover over-allotments, if any.

The public offering would dilute shareholders’ investments, and as such Dynavax shares are currently dropping nearly 4% to $17.90. DVAX has a 1-year high of $19.60 and a 1-year low of $3.20. The stock’s 50-day moving average is $10.80 and its 200-day moving average is $6.80.

Dynavax anticipates using the net proceeds from the proposed offering to fund activities associated with preparing for the anticipated U.S. commercial launch of HEPLISAV-B, should HEPLISAV-B gain approval by the Food and Drug Administration. In addition, net proceeds from the offering will support continuing the clinical development of its lead investigational cancer immunotherapeutic product candidates, SD-101 and DV281, continuing research and development activities, and for other general corporate purposes, including working capital.

On the ratings front, Dynavax has been the subject of a number of recent research reports. In a report released yesterday, William Blair analyst Y Katherine Xu reiterated a Buy rating on DVAX, with a price target of $30, which implies an upside of 63% from current levels. On August 3, Cowen’s Phil Nadeau reiterated a Buy rating on the stock and has a price target of $30 as well.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Y Katherine Xu and Phil Nadeau have a yearly average return of 17.4% and 12.2% respectively. Xu has a success rate of 53% and is ranked #490 out of 4628 analysts, while Nadeau has a success rate of 54% and is ranked #315.

Dynavax Technologies Corp. is a clinical-stage biopharmaceutical company that uses toll-like receptor biology to discover and develop novel vaccines and therapeutics. The company’s development programs are organized under its three areas of focus: vaccine adjuvants, cancer immunotherapy, and autoimmune and inflammatory diseases. Its lead product candidate is HEPLISAV, a Phase III investigational adult hepatitis B vaccine. The company’s other products under pipeline are SD-101, DV1179 Autoimmune Disease and AZD1419 Asthma Therapy.

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