T2 Biosystems Inc

T2 Biosystems, Inc. (NASDAQ: TTOO) is an in vitro diagnostics company focused on the detection of sepsis-causing pathogens and antibiotic resistance genes. Its technology enables detection of pathogens, biomarkers and other abnormalities in a variety of unpurified patient sample types, including whole blood, plasma, serum, saliva, sputum and urine, and can detect cellular targets at limits of detection as low as one colony forming unit per milliliter (CFU/mL).

Recent Business and Financial Updates

• Recent Financial and Operational Highlights: In the second quarter of 2024, the company achieved total revenue of USD 2.0 million, entirely from sales of its sepsis products. This period marked record quarterly and first-half revenue for sepsis tests, showing a growth of 27% and 25% respectively, compared to the previous year's periods. This growth was primarily driven by sales of the T2Bacteria® and T2Resistance® panels. During the second quarter, contracts for two T2Dx® Instruments were executed outside the U.S., with an additional six instruments contracted in July 2024. The company also secured multiple international distribution agreements in regions including the Middle East and Asia, covering countries such as Qatar, Hong Kong, Malaysia, Indonesia, and Macau.
• Financial Improvements and Fundraising: The company strengthened its balance sheet by converting USD 30.0 million of term loan debt with CRG Servicing LLC (“CRG”) into T2 Biosystems equity. This conversion significantly reduced both total debt and quarterly interest payments to CRG by approximately 80% from May 2023 levels. Additionally, the company raised USD 8.0 million in gross proceeds through a private placement stock sale executed in May 2024. The loss from operations in the second quarter of 2024 was USD 9.6 million, a 27% improvement compared to the USD 13.1 million loss in the same quarter of 2023.
• Pipeline and Clinical Highlights: The company completed the clinical studies necessary to launch the T2Lyme Panel as a laboratory developed test (LDT) in the third quarter of 2024. Furthermore, it submitted a 510(k) premarket notification to the U.S. FDA to extend the use of the T2Candida® Panel to include pediatric testing. The T2Resistance Panel has been advanced towards a U.S. FDA 510(k) submission, which is now expected to occur in the fourth quarter of 2024. New data presented at the American Society for Microbiology (ASM) Microbe 2024 conference highlighted the clinical benefits of the culture-independent T2Candida Panel.
• Second Quarter 2024 Financial Results and Outlook: The total revenue for the second quarter of 2024 was USD 2.0 million, consistent with the prior year period. Sepsis test revenue saw a 27% increase compared to the prior year, offset by declines in international instrument sales. The cost of product revenue decreased by 45% to USD 2.7 million, driven by increased test sales and lower instrument sales. Research and development expenses were reduced by 13% to USD 3.4 million due to decreased clinical trial activities. Selling, general, and administrative expenses also decreased by 13% to USD 5.5 million, attributed to lower headcount spending. The company reported a net loss of USD 9.2 million, or USD 0.66 per share, for the second quarter of 2024, compared to a net loss of USD 6.3 million, or USD 7.84 per share, in the prior year period. Cash and cash equivalents were USD 4.2 million as of June 30, 2024, down from USD 6.2 million as of March 31, 2024. The company reiterated its financial outlook for 2024, expecting full-year sepsis product revenue to range from USD 10.0 million to USD 11.0 million, representing a growth of 49% to 64% compared to USD 6.7 million in 2023. This guidance excludes potential sales of the T2Biothreat Panel or the T2Lyme Panel.

Technical Observation (on the daily chart):

The Relative Strength Index (RSI) over a 14-day period stands at a value of 46.75, consolidating, with expectations of a consolidation. Additionally, the stock's current positioning is between both 50-Day SMA and 200-Day SMA, which can act as a short to medium term resistance and support levels respectively.

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Watch’ rating has been given to T2 Biosystems, Inc. (NASDAQ: TTOO) at the current market price of USD 4.89 as of July 30, 2024, at 06:50 am PDT.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is July 30, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.s

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.