Stonegate Updates Coverage on Incannex Healthcare Inc. (IXHL) 2Q 2025

Core Insights - Stonegate Capital Partners has updated its coverage on Incannex Healthcare Inc. (NASDAQ: IXHL) for Q2 2025, highlighting a decrease in R&D costs and a strategic financing agreement [1][6]. Financial Performance - Incannex reported R&D costs of $1.4 million in Q2 2025, down from $2.6 million in the same period last year, primarily due to the completion of the IHL-42X clinical trial and resource reallocation [1]. - The company recovered 68.3% of R&D costs through a tax incentive amounting to $0.956 million [1]. - The net loss for the quarter was $5.9 million, compared to $5.2 million in the same period of the previous year [1]. Strategic Developments - Incannex secured a strategic financing agreement with Arena Investors, which includes a $50 million equity line of credit (ELOC) [6]. - The IHL-42X study yielded positive top-line results, confirming the bioavailability of the drug components [6]. Valuation Insights - A probability adjusted discounted cash flow (DCF) model estimates the share valuation range for Incannex at $5.08 to $5.96, with a midpoint of $5.50 [6].