What's Going On With Tempest Therapeutics Stock?

Shares of the South San Francisco-based micro-cap biopharma Tempest Therapeutics Inc. TPST were soaring Monday for a second consecutive trading session on above-average volume.

Tempest's Wild Ride: Tempest, which recently began trading on the Nasdaq through a reverse merger with Millendo Therapeutics, is a clinical-stage oncology company advancing small molecules that combine both targeted and immune-mediated mechanisms with the potential to treat a wide range of tumors.

Tempest shares closed at $13.26 on June 28, the day of their debut following the reverse merger.

Millendo closed the previous session at a reverse split-adjusted price of $15.90. Millendo effected a 1-for-15 reverse split of its common stock in connection with the closure of the merger.

Subsequent to its debut, Tempest stock was moving in a range until Thursday, and on Friday it spiked about 50% before closing at $15.67. The momentum is continuing into Monday's session.

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The Company: Tempest's pipeline consists of two Phase 1 candidates, namely TPST-1495 and TPST-1120, and an orally available inhibitor of TREX-1 designed to activate selectively an innate immune response pathway important for the development of anti-tumor immunity.

The reverse merger with Millendo was completed June 28. Concurrent with the closure, Tempest also completed a $30-million PIPE financing transaction in which a consortium of health care investors participated.

Tempest has about 6.7 million outstanding shares.

About 81% of stake in the company is now owned by past Tempest shareholders and investors in the PIPE financing, and the remaining by Millendo shareholders.

Retail Interest Behind Stock Spike? Tempest and its predecessor Millendo have seen a huge retail following. In a Reddit post late last week, a user by name romanlaz highlighted that several institutional investors and hedge funds have either taken fresh positions or increased stakes in the biopharma.

Given the spike has come despite a lack of any major news — other than an announcement Friday regarding the company's participation in a panel July 14 — suggests a retail prop is likely to be in the works.

At last check, Tempest shares were up 61.45% at $25.30.

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