Reneo Pharmaceuticals Inc

Reneo Pharmaceuticals, Inc. (NASDAQ: RPHM) is a clinical-stage pharmaceutical company. The Company is focused on the development and commercialization of therapies for patients with rare genetic mitochondrial diseases, which are often associated with the inability of mitochondria to produce adenosine triphosphate (ATP).

Recent Financial and Business Updates:

• First Quarter and Recent Highlights:
  • Successfully completed enrollment with 213 patients in the pivotal STRIDE study of mavodelpar (REN001) for adult patients with primary mitochondrial myopathies (PMM), surpassing the targeted enrollment of 200 patients. Topline results are expected to be disclosed in the fourth quarter of 2023.
  • Enrolled over 100 patients in the STRIDE AHEAD study, the mavodelpar open-label extension (OLE) trial for adult patients with PMM, with over 50 patients reaching the 6-month mark in the study.
  • Expanded the STRIDE AHEAD study to include adult patients with PMM due to nuclear DNA (nDNA) defects and plans to commence enrollment of nDNA patients in the second quarter of 2023.
  • Received Fast Track Designation from the United States (US) Food and Drug Administration (FDA) for mavodelpar for a genotype of long-chain fatty acid oxidation disorder (LC-FAOD).
  • Presented a preclinical poster at the Society for Inherited Metabolic Disorders (SIMD) Annual Meeting, titled "PPARδ Agonist REN001 Improves Mitochondrial Function in Skeletal Muscle: A Potential Treatment for Primary Mitochondrial Myopathies."
  • Successfully raised USD 68.3 million in gross proceeds from a concurrent public offering and private placement in May 2023.

• Financial Results for the Three Months Ended March 31, 2023:
  • Reported a net loss of USD 15.1 million, or USD 0.60 per share, during the first quarter of 2023, compared to a net loss of USD 13.0 million, or USD 0.53 per share, for the same period in 2022.
  • Held USD 93.8 million in cash, cash equivalents, and short-term investments as of March 31, 2023.
  • Research and development (R&D) expenses were USD 11.0 million during the first quarter of 2023, compared to USD 9.3 million for the same period in 2022, primarily due to increased clinical study costs to support the marketing registration of mavodelpar.
  • General and administrative (G&A) expenses were USD 5.1 million during the first quarter of 2023, compared to USD 3.7 million for the same period in 2022, primarily due to additional facility and personnel-related costs attributed to an increase in headcount.
  • Successfully completed a public offering and a concurrent private placement in May 2023, raising total net proceeds of approximately USD 58.2 million and USD 4.7 million, respectively.
    

Technical Observation (on the daily chart)

The price of RPHM stock has shown a consistent downward trend since making 52-week high on April 21, 2023, correcting around 38.09%. Currently, the stock is near an important support zone of USD 6.00-USD 6.50, from where price has taken support in the past. The RSI (14 period) momentum indicator is at a value of 51.12, with expectations of some consolidation or an upside momentum. Moreover, the price is currently positioned between both the 21-day SMA and 50-day SMA trend-following indicators, which may act as dynamic short-term support and resistance levels respectively.

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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 ‘Speculative Buy’ rating has been given to Reneo Pharmaceuticals, Inc. (NASDAQ: RPHM) at the closing price of USD 7.02 as of July 27, 2023.

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. 

How to Read the Charts?

The Green colour line reflects the 21-period simple moving average (SMA) while the red line indicates the 50- period simple moving average (SMA). SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is July 27, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by individual. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.

Disclaimer

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