Yesterday, the share price of Guided Therapeutics, Inc. (OTC:GTHP) stock dropped to a new bottom as the company issued its latest press release. Still, the market valuation of GTHP looks somewhat too optimistic and based on expected future performance. 
GTHP closed the market yesterday at $0.85 for a share, representing a decline of 12.37% from the previous close. Trading volume of 425,518 was several times the average and thus substantial, making the stock chart suggest that the stock could fall further down today. During yesterday’s session GTHP share price fell to a six-month bottom of $0.80.
It looks like the dramatic events were initiated by an update issued by GTHP shortly after the market opened. The update concerned the premarket approval review of GTHP for its product candidate LuViva, which is to be used as a test to detect cervical disease. According to the press release, the FDA has requested additional information about GTHP response to one of some previously asked by the FDA questions.
Guided Therapeutics says that it should be able to provide that information on time, but still it looks like the market perceived the new information as a delay in the company’s plans to progress with its product development. Anyway, GTHP current market value of over $40 million looks too optimistic for the current state of the company’s assets and operations, which does not necessarily mean that there is no potential.
As of end-March 2011, the company had around $3 million in total assets, $2.4 of which liquid, while its total liabilities amounted $2.36 million, $2.3 million of which classified as current. That makes a small positive working capital, which would be enough only to survive by the end of the year. For the further development of its products, however, GHTP will have to raise new funds, which will most likely dilute the current shareholders of the company.
