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Why is IsoPlexis (ISO) stock up 80% today?


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IsoPlexis (NASDAQ:ISO) the stock jumped more than 80% today following the announcement that the company will partner with Berkeley Lights (NASDAQ:BLI). The two names will merge into a new company called PhenomeX.

Berkeley will pay $57.8 million in BLI stock as part of the acquisition agreement. As a result, ISO shareholders will hold a 25% stake in PhenomeX while Berkeley shareholders will hold the remainder. The two companies state in a press release that PhenomeX will be a “functional cell biology company”.

Shares of ISO stocks rise as investors analyze this trade. Here’s what investors need to know about the Berkeley Lights-IsoPlexis combination.

What’s going on with IsoPlexis?

Connecticut-based IsoPlexis is “known for its proteomic barcode chips that allow doctors and researchers to analyze all the proteins in a cell and see how a person’s immune system would likely respond to different treatments. “. The idea is to personalize cancer treatment and refine immunotherapies.

IsoPlexis went public again in October 2021 and traded as low as $15.70 just a month later. However, yesterday it closed the day at just 69 cents. In an S-1 form last year, the company claimed $3.2 million in revenue for the first quarter of 2021, double the figure for the first quarter of 2020. Meanwhile, the net loss for the first quarter 2021 amounted to $15.6 million. Looking ahead, analysts expect IsoPlexis to hit $27 million in revenue for 2023.

As of this writing, IsoPlexis has a market capitalization of just $50 million. The difference between the offering price and this market capitalization is due to the fact that the deal is an all-stock transaction. The final value will depend on the value of the shares of BLI at the time of closing.

For the third quarter of 2022, Berkeley Lights lost $21.5 million on revenue of $21.3 million. The company also reported nearly $135 million in cash and marketable securities at the end of the period. As of this writing, Berekeley has a market capitalization of around $167 million. Analysts expect revenue of around $100 million next year.

All told, this is the kind of 1+1=1 deal you find near market lows. The two companies are teaming up to continue the work of IsoPlexis using Berkeley money, hoping something valuable will emerge from the combination.

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As of the date of publication, Dana Blankenhorn does not hold (either directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

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