Ensysce Biosciences Inc ( ENSC ) shares are trading lower by 30% to 44 cents during Thursday’s session after the company announced a $5 million registered direct offering and concurrent private placement.

What Investors Need To Know: Ensysce issued 3.55 million shares of common stock at a price of 47 cents per share. Additionally, Ensysce entered into agreements to exercise existing warrants, originally issued in February 2024, at a reduced exercise price of 47 cents per share, down from $1.06.

The company also conducted a concurrent private placement, issuing unregistered Series A-3 and A-4 warrants for the purchase of up to 14.36 million shares each, with the same 47 cent exercise price.

The Series A-3 warrants are valid for 18 months, and the Series A-4 warrants are valid for five years, both starting from the date of stockholder approval.

What Else: The proceeds will be used to further develop Ensysce’s TAAPTM and MPAR® programs and to provide working capital.

This fundraising effort also complements a recent $14 million NIH grant aimed at supporting the clinical development of PF614-MPAR, an abuse-deterrent opioid with overdose protection.

Read Also: Why BioCardia (BCDA) Stock Is Up 95% Today

Should I Sell My ENSC Stock?

Whether to sell or hold a stock largely depends on an investor's strategy and risk tolerance. Swing traders may sell an outperforming stock to lock in a capital gain, while long-term investors might ride out the turbulence in anticipation of further share price growth.

Similarly, traders willing to minimize losses may sell a stock that falls a certain percentage, while long-term investors may see this as an opportunity to buy more shares at a discounted price.

Shares of Ensysce Biosciences ( ENSC ) have lost 76.75% year to date. This compares to the average annual return of -90.53%, meaning the stock has outperformed its historical averages. Investors can compare a stock's movement to its historical performance to gauge whether this is a normal movement or a potential trading opportunity.

Investors may also consider market dynamics. The Relative Strength Index can be used to indicate whether a stock is overbought or oversold. Ensysce Biosciences ( ENSC ) stock currently has an RSI of 90.15, indicating overbought conditions.

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According to data from Benzinga Pro, ENSC has a 52-week high of $2.06 and a 52-week low of $0.36.