BioExx Specialty Proteins (TSE:BXI) on Wednesday saw its target price downgraded 90 percent by Stonecap Securities, citing weak operations at the company's main production facility.
Stonecap analyst, Michael Goldberg, CFA, lowered BioExx's target stock price to $0.25 per share, from $2.50 per share previously, and downgraded the company's rating to 'sector perform', from 'outperform'.
In Toronto, BioExx stock closed at $0.17 per share on Tuesday.
After a series of delays and operating setbacks, BioExx is currently producing only 1.2 tonnes of Isolexx per week, representing two percent of its total capacity, Stonecap said. The equity research firm said it had expected a break-even utilization of 70 percent.
"We believe the probability of achieving commercial production under the current operating strategy is now materially lower than first estimated," Goldberg said in a statement.
BioExx reported its third quarter results on Tuesday, which Stonecap said was in line with expectations. For the three months ending September 30, BioExx widened its net loss to $5.75 million, or $0.03 loss per share, from $3.04 million, or $0.02 loss per share, a year ago.
Revenues spiked to $930,239, from $178,464 in the same period last year, based on 2.0 billion tonnes of seed processed during the quarter, compared to 500 million tonnes in the year-ago period.
BioExx also announced the appointment of CFO and interim CEO, Chris Schnarr, to the position of CEO.
Schnarr confirmed management's intention of curbing the building and operation of future protein production plants, to instead search for a strategic partner with better access to capital, infrastructure, and market presence in order to move forward.
Stonecap said that, in a conference call, BioExx indicated it has had some discussions with various parties.
Goldberg continued: "We believe that shareholder value is likely to be surfaced through some form of residual interest in the future value of the production process once it can be optimized."
BioExx is focused on the separation of oil and high-value proteins from oilseeds for global food, beverage, and nutrition markets, among others. Its proprietary technologies use lower temperatures in the separation process, resulting in a higher-quality protein.
As of 9:42 am EDT, BioExx shares were down 2.94 percent to $0.165.