Mesoblast shares are swimming in a sea of red.
The post The Mesoblast (ASX:MSB) share price has dropped 12% in a month. What’s happening? appeared first on The Motley Fool Australia. –
The Mesoblast Limited (ASX: MSB) share price is edging higher during trade on Thursday. At market close, it is up 0.99% and is now changing hands at $1.53 each.
Despite the gains today, shares in the small cap biotech company have slipped 12% into the red this past month, capping off a difficult year for shareholders.
This is ahead of the S&P/ASX 300 Pharmaceuticals & Biotechnology index (AXPBKD) which has clicked around 8% lower in this time.
What’s headwinds has the Mesoblast share price faced lately?
Zooming out past the last month, the Mesoblast share price dove off the springboard after the company released its FY21 earnings on 31 August.
Here the company recorded a substantial 77% down-step in revenue over the prior year, resulting in a net loss after tax (NLAT) of US$98.8 million.
Perhaps more alarming, is concerns the company may need to hit the capital markets again, to raise more funds via debt or from investors.
In its report, the company acknowledged that “cash inflows will be required” in order to service its existing debt facility.
This may depend on whether it can form “more strategic partnerships, or restructure existing loan agreements, and have prepared the financial report on a going concern basis”.
Since its FY21 was released, Mesoblast’s share price has dropped 22% from a previous high of $1.98.
Then came reports that the company was facing increasing scrutiny from the US Food and Drug Administration (FDA) on its remestemcel-L label.
The FDA requires Mesoblast to provide additional data before it is approved for emergency use in the treatment of acute respiratory distress syndrome (ARDS).
Whilst this secured a swift recovery in the Mesoblast share price, it wasn’t enough to overcome the selling pressures to date.
Aside from this, there has been no price-sensitive information that is remarkable for the company in this time.
Mesoblast share price snapshot
The Mesoblast share price has been swimming in a sea of red this year to date, and also over the past 12 months.
It has posted a loss of 32% since January 1, extending its loss over the last year to 54%.
Both of these results have lagged the S&P/ASX 200 index (ASX: XJO)’s climb of around 25% this past year.
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The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.