Rodman & Renshaw has downgraded Karyopharm Therapeutics (NASDAQ: KPTI) to Neutral from Buy and withdrawn its price target following the company’s voluntary Chapter 11 bankruptcy filing.
Karyopharm also entered into a Restructuring Support Agreement with existing lenders and noteholders. The proposed transaction includes a merger between Ayrmid Ltd. and a reorganized Karyopharm under a court-supervised Chapter 11 plan.
The company’s financial position has deteriorated sharply. Karyopharm has reported total debt of $328.53 million, while its market capitalization has fallen to approximately $2.45 million. Its current ratio stands at 0.79, and short-term obligations exceed liquid assets. The stock has also lost 89% over the past year.
Rodman & Renshaw analyst Michael King Jr. said the main issue for shareholders is the order in which creditors and equity holders may recover value, rather than the company’s operating outlook. The firm believes that, because lenders and noteholders hold senior claims under the proposed plan, the value available to existing shareholders is highly uncertain and could be minimal.
The brokerage said its previous estimates and price target were based on an operating-company framework in which shareholders would retain value from Karyopharm’s commercial and pipeline assets. It said that framework no longer applies and that the earlier estimates and target should not be relied upon.
According to the firm, Karyopharm shares will now be driven primarily by the terms of the restructuring plan, any competing bids and the treatment of existing equity, rather than by the company’s underlying operating fundamentals.
The bankruptcy filing follows recent financial pressure. In its second-quarter results, Karyopharm reported an adjusted loss of $2.32 per share, wider than the expected $1.31 loss. Revenue reached $33.4 million, slightly above the $33.12 million forecast but 12% below the prior-year period, mainly because Menarini reimbursements ended in late 2025.
U.S. sales of Karyopharm’s main product, XPOVIO, rose 3.7% year over year. The company reported $65.4 million in cash and an upcoming loan payment of $16.8 million. Management had reaffirmed its full-year revenue guidance and said it was evaluating financing and strategic alternatives, while the myelofibrosis program remained a focus supported by Phase III data.
Sources: Investing.com News.