SMALL CAP MOVERS: C4X Discovery cashes in on deal with pharmaceutical giant

It's fair to say C4X discovery had a fantastic start, with shares rising 113 percent in the drug giant's shortened trading week AstraZeneca delivered an $11 million windfall after Christmas.

It came in the form of what experts are calling a “milestone payment” under a $402 million deal with the Anglo-Swedish giant, which licensed the right to NRF2 activator, created by C4XD, to tackle chronic respiratory diseases.

Analysts said the payment went beyond adding a material amount to the AIM company's coffers; it provided third-party validation of the technology.

C4X received a “milestone payment” under a $402 million deal with AstraZeneca

C4X received a “milestone payment” under a $402 million deal with AstraZeneca

“We see this as an important change in value that should revive sentiment in the share,” said regional broker Shore Capital.

“Additionally, this serves as a timely reminder that C4XD has licensing agreements in place with some of the leading developers for its programs.”

Stay with the sector, Lot Pharma (down 2.2 percent during the trading week) reminded the market that it was still around and in discussions with a partner for one of two Phase III-ready assets developed to tackle antimicrobial resistance.

Analysts at Cavendish, Equity Development and Intron Health crunched the numbers and weighed the economic potential of assets against the chances of success.

Calculating the sums, our abacus rattles arrived at a per-share valuation range of 120p-285p per share, or a market capitalization of £113m to almost £270m. Remember, the market currently values ​​the company at £63m.

The market overall had a slow start to 2024, with the AIM All-Share Index falling more than 160 points to 751.66 over the four-day week.

The FTSE 100 fared better, although the blue chip index also finished in the red on Friday.

Equities were hit by declining hopes for near-term interest rate cuts, with US economic and employment data remaining stubbornly high and European inflation also rising after six months of slowing price growth.

British economic data was sparse and so couldn't move the needle too much, although the market can at least cheer that British house prices are rising for the third month in a row, according to the Halifax House Price Index.

Another big mover was Corner plc (up 145 percent), which has developed a liquid biopsy technology that essentially tests for cancer by identifying microscopic circulating tumor cells.

The company's latest innovation involves the expansion of its Parsortix system, which now includes molecular DNA analysis.

These advances enable detailed examination of both circulating tumor cells (CTCs) and fragments of DNA released by dying cells (ctDNA) from a single blood sample.

In a recent study of 47 patients with breast, lung, prostate and ovarian cancer, ANGLE's technology successfully identified key DNA mutations in CTCs that were not detected in ctDNA.

This finding is particularly important because it includes mutations that are targeted by FDA-approved cancer drugs but have been missed by traditional ctDNA analysis.

In the mining sector Horizontal mineralswhich is building a nickel processing facility in northern Brazil, rose almost 50 percent on follow-on purchases following the news (announced over Christmas) that it had struck an interim financing deal.

Sondrel (Holdingen) plc was one of the biggest gainers in the technology sector, up almost 30 percent over the week.

Sondrel, a minnow in the world of specialized microchip designs, appears to be rebounding after project delays sent its stock price plummeting in the second half of 2023.

It has certainly been a mixed bag for UK small and mid-cap hospitality stocks during the recent bear market.

On the one hand, diversified groups like Sun loungers plc, which operates cafes, pubs and eateries, held up remarkably well.

On the other hand, chicken stocks are favorites Revolution bars plc are in the output bin as the appetite for flashy cocktails and vodka shots appears to have waned.

The group has just announced the closure of eight of Britain's least profitable bars, with CEO Rob Pitcher blaming upcoming minimum wage increases and the fact that younger customers are “still feeling the disproportionate effect of the crisis on the cost of living” '.

Revolution Bars also announced that sales fell 2.8 percent over the year, although festive returns were the best since 2019.

Shares fell more than 20 percent on Friday after the updates, taking the group's market value below £10 million.

In the energy sector, a deeply discounted funding round, which raised £600,000 in new investment, saw the Landore Resources stock price flops 18 percent.

It was a similar story before Clontarf energy (a drop of 32 per cent), which raised a paltry £350,000 in funding.

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