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bioAffinity (BIAF) Stock Pops 100% in Red-Hot IPO

  • bioAffinity (BIAF) soared more than 100% following its red-hot IPO today.
  • This IPO appears to reflect investor demand for bioAffinity's products, as well as its healthcare-related offerings.
  • However, the existence of IPO-related warrants could pour cold water on BIAF stock in the near-term.
BIAF stock - bioAffinity (BIAF) Stock Pops 100% in Red-Hot IPO

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Well, it turns out the initial public offering (IPO) market isn’t quite dead. The latest IPO to hit the markets today is that of bioAffinity (NASDAQ:BIAF). At the time of writing, BIAF stock has surged more than 80% from its offering price. However, this hot IPO previously saw gains of more than 100% in earlier trading.

Shares of this maker of lung cancer tests have soared, as investors appear to be extremely bullish on this company’s forward-looking potential. In this beaten-down market, healthcare names have garnered attention as defensive plays. Accordingly, it appears demand for any stock tied to this sector remains relatively high, compared with previous high-growth areas such as tech.

After announcing pricing at the middle of a reduced range today, BIAF stock went public at $6.125 per share. However, the market appears to believe that this IPO should have been priced higher, as evidenced by today’s price action.

Let’s dive into what investors should make of this IPO.

Is BIAF Stock a Buy After Its Red-Hot IPO?

As a maker of cancer diagnostics products, bioAffirm is an interesting company to dive into. This company appears intent on using the $8 million in proceeds from its IPO to commercialize its existing CyPath lung test for early cancer detection. The ultimate size of this market, and bioAffinity’s ability to capture market share, are still variables to be considered. However, with more growth capital comes more potential. And today, investors appear to be taking a bullish stance on this company’s prospects.

Now, bioAffinity’s IPO included some fine print investors may want to pay attention to. For early investors in this IPO, one share of BIAF stock was received in addition to one tradable warrant to buy one share at $7.35 and another warrant to buy one share at $7.656. Accordingly, in the near term, one might expect to see some downside pressure as warrants are converted, increasing the share count and lowering the average price per share toward the warrant prices.

Overall, BIAF stock appears likely to be volatile, at least over the next few days. The existence of these warrants is something that concerns me, with respect to the ability for this stock to fly higher from here. That said, we’ve seen some incredible price action this year with IPOs. Perhaps the trend isn’t yet over.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

Article printed from InvestorPlace Media, https://investorplace.com/2022/09/bioaffinity-biaf-stock-pops-100-in-red-hot-ipo/.

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