Truist cuts Celularity to 'hold' on likely cash crunch

Celularity

06/04/2022 13:04

** Brokerage Truist cuts its rating on cell therapy
developer's shares  CELU.O  to "hold" from "buy" over concerns
regarding its liquidity
    ** Celularity's cash burn rate of ~$25 mln per quarter
compares to its cash of $37.2 mln in Q4, exercise of options in
March likely only extends financing for 5-6 months at most -
brokerage
    ** Following CELU's SPAC deal last year, company cannot tap
public markets for funding until late July/early August at the
earliest due to deal terms - Truist
    ** Celularity went public in July last year through a SPAC
merger with GX Acquisition Corp, and received proceeds of $138
mln through the deal
    ** "We also would like to see data from any of the three
ongoing programs before becoming more constructive on the name"
- brokerage
    ** 2 of 4 brokerages rate the stock "buy" or higher, 2
"hold"; median PT $10 - Refinitiv data
    ** Company's shares down nearly 8% since SPAC deal closed in
July

 (Reporting by Manas Mishra in Bengaluru)
 ((Manas.Mishra@thomsonreuters.com;
www.twitter.com/Manaswrites15))