Taronis Technologies TRNX Stock News

Taronis Technologies Inc (NASDAQ: TRNX) had a great day in the market yesterday, trading on gains of 109.9% at the closing bell. Today, the impressive gains continue. As we speak, the stock is up more than 30% in the premarket hours. The gains come after the company said it would not be moving forward with a reverse stock split. Here’s what’s happening:

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TRNX Will Not Pursue A Reverse Split

Due to the fact that Taronis Technologies is trading under $1 per share, there has been a fear that the company would move forward with a reverse stock split. This would ultimately bring the price per share over the $1 threshold, helping the company to maintain its NASDAQ listing.

However, the company recently said that it would not take any immediate actions to initiate a reverse split. However, that’s not the only positive news.

In the press release, TRNX said that management has cleared all material short term liabilities. Moreover, the company has enough funds to get through the current year based on its business objectives and capital requirements. So, not only is the comapny saying no to the reverse split, it’s got plenty of money in the bank.

In a statement, Scott Mahoney, CEO at TRNX, had the following to offer:

The Company has taken a very proactive position with regards to capital and liquidity management, given the highly uncertain business climate caused by the coronavirus pandemic. The capital markets have become extremely unpredictable, and the Company elected to secure a significant amount of capital to ensure we can execute our business plans without further reliance on the capital markets for the remainder of 2020.

We have cleared all material indebtedness. We plan to retire the entire $3.5 million existing convertible preferred equity in the immediate future, and we expect to have little to no vendor and service provider liabilities going forward. We have significant cash on hand at this time, and we intend to make this last for the foreseeable future.

However, as a nationally listed Company, our listing status may exceed the value of our current business model. We have been solicited for a variety of potential strategic alternatives, and we will entertain all potential options to maximize shareholder value.

Why Are Investors So Excited?

There are a few reasons for the excitement here. First and foremost, reverse stock splits are essentially a bad omen in the stock market. They tend to outline the financial struggles had by companies, and therefore, lead to increased selling in the stock. So, the fact that Taronis Technologies won’t be going that route is good news.

Another factor that is likely helping to boost the excitement level is the fact that the company has plenty of money sitting in the bank. As they said in the press, TRNX has the funding it needs in order to get through the current calendar year and will not be looking for new funds any time soon. Of course, that’s exciting news as it takes risk of dillution largely off of the table.

Finally, In the release, the company said that it has been solicited for various strategic alternatives. I love the term “strategic alternatives” as these often include potential mergers and acquisitions. Considering the fact that the company is not concerned about delisting, there’s a good chance that some deal of this sort is on the horizon, making TRNX a stock that’s well worth watching.

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