ViewRay Prices $50M Public Offering; Shares Drop 13%

Shares of ViewRay dropped 13% in Tuesday’s pre-market session after the corporate introduced the pricing of a public providing of 10.31 million shares of frequent inventory at a value of $4.85 per share, to boost gross proceeds of $50 million. Shares of the radiation remedy system producer closed 67.8% larger on the shut on Monday after releasing preliminary This autumn and full-year outcomes.

As a part of the providing, ViewRay (VRAY) has given the underwriters a 30-day choice to buy as much as one other 1,546,500 shares of frequent inventory on the public providing value, much less underwriting reductions and commissions.

The corporate plans to make use of the providing proceeds for basic company functions, together with working capital, capital expenditures, continued analysis and growth and industrial bills.

The providing is anticipated to shut by Jan. 7, 2021, topic common closing circumstances. Piper Sandler & Co. is the only real book-running supervisor for the providing with B. Riley Securities, and Oppenheimer & Co. because the co-managers.

Following the corporate’s launch of preliminary monetary outcomes, Piper Sandler analyst Jason Bednar reiterated a Purchase ranking on the inventory and a value goal of $4 (37.6% draw back potential).

In response to Bednar, the corporate’s This autumn gross sales rose by 6% year-on-year to $18 million exceeding the Road consensus by $7.2 million. The corporate obtained 5 new orders value $24 million surpassing the Road’s estimates by $5 million.

Bednar was “impressed” with the execution of administration by the COVID-19 pandemic, with wholesome system installs and new orders regardless of the tougher atmosphere for big-ticket hospital capex objects.

Bednar continues to imagine that the corporate can develop its MRgRT [Magnetic resonance guided radiotherapy] uptake and utilization which will start to inflect larger on the opposite aspect of the pandemic.

Due to this fact, Bednar stays “positively inclined” on the inventory. (See VRAY stock aanalysis on TipRanks)

From the remainder of the Road, the inventory scores an analyst consensus of a Sturdy Purchase primarily based on 4 Buys and 1 Maintain. The common analyst price target of $5 implies draw back potential of twenty-two% to present ranges.

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