T2 Biosystems (NASDAQ: TTOO) stock price made a strong comeback during the pre-market session as investors bought the dip. The shares surged by more than 40%, its best daily performance since August. It soared to a high of $0.4075, the highest level since August 24th.
Why did T2 Biosystems shares jump?T2 Biosystems is a small company in the emerging field of vitro diagnostics. The company is building products to address needs in the healthcare sector, starting with sepsis.
T2 Biosystems stock price has been highly volatile in the past few months. Its weakness accelerated in March after the company published weak financial results. In a statement, the management said that its revenue dropped by 67% YoY to just $2 million.
T2 Biosystem’s revenue plunged because of a sharp decline in BARDA research contribution revenues and lower COVID-19 test sales. Its cost of product revenues slipped by 4% to $4.9 million while its total loss came in at $6.3 million.
TTOO stock price also dropped after the company received a delisting notice from Nasdaq. It has addressed some of the listing issues as the management works to solve the share price condition. In its earnings, the company said that it will complete its listing conditions by November.
It is unclear why the T2 Biosystems shares jumped in the pre-market session. The most recent news was that the company provided inducement awards to four employees. In its statement, T2 said that the award will consist of three option grants to purchase 1,200 shares and one grant of restricted stock units covering 40,000 shares.
The other reason why TTOO stock rose is that the company regained an FDA compliance for its device. It regained the Substantially Equivalent (SESE) notice, meaning that the device is safe to use as it it operates in a similar manner to other devices in the market.
TTOO stock price forecast
The daily chart shows that the T2 Biosystems stock price formed a strong bottom at $0.2408 this month. It then made a strong comeback in the pre-market session and rose to the highest level since August 24th. It also moved above the 50-day and 25-day moving averages.
Therefore, I suspect that the shares will likely continue rising as buyers target the resistance at $0.50. It will then resume the downtrend later this week as buyers start to take profits.
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