Shares of Synairgen plc (LON: SNG) today surged 9.44% despite the admission to trading of 4,809,726 new ordinary shares worth £87 million earlier today. The respiratory drug discovery and development company made the announcement on Monday.
Investors embraced news of the share issue given that Synairgen shares closed Friday’s session trading at 168p, yet the new shares were issued at an average price of about 181p.
We are always impressed whenever we see a company issue new shares at prices that are above its current share price, which shows that investors want to own the company even at higher prices.
The company has had an impressive run this year given that it is up 3,206% this year due to the success of its SNG001 drug in treating patients with critical symptoms of COVID-19.
The company has inked several partnerships recently that are likely to pay off significantly given the rising coronavirus cases in Europe and across the globe.
However, investors are worried that the company’s revenues will take a major hit once the coronavirus pandemic is under control leading to a significant decline in demand for its SNG001 drug.
The company’s management has reassured investors that it is working on other drugs to complement its COVID-19 drug and will leverage its enviable market position to generate sales for its other drugs.
Synairgen share price
Synairgen shares today surged 9.44% to trade at 197p having rallied from Tuesday’s closing price of 180p.