Bullfrog AI Holdings Inc

Bullfrog AI Holdings, Inc. (NASDAQ: BFRG) is a technology-enabled drug development company. The Company is focused specifically on advanced artificial intelligence / machine learning (AI/ML) analysis of complex data in the advancement of medicine. The Company’s platform technology, bfLEAP, is an analytical AI/ML platform that is a potentially disruptive tool for the analysis of pre-clinical and/or clinical data sets, such as the robust pre-clinical and clinical trial data sets being generated in translational research and development and clinical trial settings.

Recent Business and Financial Updates

Revenue Generation: BFRG's revenue generation commenced in late 2022 with services provided to a pharmaceutical customer. By the third quarter of 2023, BFRG completed its inaugural commercial service contract, recognizing USD 65,000 in revenue. However, no revenue was generated in the first quarter of 2024.

Research and Development Expenses: BFRG's research and development (R&D) expenses primarily encompass costs related to acquiring licensed technology, payments to external service providers, and internal personnel expenses focused on its proprietary platform, bfLEAP™, and other AI/ML tools. These costs are recorded as incurred, with estimates applied for services performed but not yet invoiced. The company anticipates a rise in R&D expenses as it pursues its business plan, engages in preclinical research, secures development partners, and files Investigational New Drug applications. The expansion of staff and analytical efforts for target discovery will further drive these costs.

General and Administrative Expenses: BFRG's general and administrative expenses include personnel-related costs, non-cash stock-based compensation, accounting and consulting fees, insurance, and legal expenses. These costs are expected to increase to support its target discovery initiatives, service offerings, and clinical and preclinical research activities. For the first quarter of 2024, these expenses saw a rise compared to the same period in 2023, attributed to hiring additional staff and the associated increases in equity compensation and recruiting fees. 

Financial Operations and Liquidity: In 2022, BFRG secured approximately USD 1,016,000 from the sale of Convertible Bridge Notes and repaid USD 49,000 in unsecured promissory notes from 2021. An additional promissory note sold in January 2023 provided USD 100,000 in net proceeds. By March 31, 2024, BFRG's accumulated deficit stood at approximately USD 11,675,000, with operations funded through stock sales and debt. The completion of its IPO in February 2023 raised USD 8.4 million, and a secondary offering in early 2024 generated USD 5.7 million. Warrant exercises in Q1 2024 added approximately USD 106,000. Despite limited revenue in 2024, BFRG's current capital resources are projected to support operations for about 12 months. Net cash used in operating activities decreased in Q1 2024 compared to Q1 2023, primarily due to reduced accrued expenses offset by higher operating costs. No cash was used in investing activities in either period, while net cash from financing activities decreased due to higher IPO proceeds in 2023 compared to the 2024 secondary offering.

Technical Observation (on the daily chart):

The Relative Strength Index (RSI) over a 14-day period stands at a value of 22.37, currently inside oversold zone, with expectations of a consolidation or a trending reversal. Additionally, the stock's current positioning is below both the 21-period SMA and 50-period EMA, which may serve as dynamic short to medium-term resistance levels.

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 Bullfrog AI Holdings, Inc. (NASDAQ: BFRG) at the closing market price of USD 1.73 as of June 28, 2024.

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. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is June 28, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.