TENAX THERAPEUTICS, INC. (TENX) stock intrinsic value fair value estimate & owner earnings analysis

Tenax Therapeutics is a clinical-stage drug developer with no revenue and no approved product. Its one program is oral levosimendan (TNX-103), licensed from Orion Corporation, for pulmonary hypertension in patients with heart failure and preserved ejection fraction (PH-HFpEF). The company has spent heavily to test it: cash used in operations rose from $5.9 million in 2023 to $14.8 million in 2024 and $35.8 million in 2025, and was $23.5 million in the first half of 2026. Because there are no earnings, we value the company as cash on hand less the money it is likely to spend before its story is resolved. What changed. On August 10, 2026 the company reported that the first Phase 3 trial (LEVEL, 241 patients) failed its primary goal. Patients on TNX-103 improved their six-minute walk distance by 14.0 meters against 10.4 meters on placebo, a 3.5 meter difference that is not statistically meaningful (p=0.63). Symptom scores were no different between the groups. Some subgroups, such as patients who started below the median walking distance or who were older than 71, did better, and a blood marker (NT-proBNP) fell 49%. Those are follow-up cuts of a failed trial, so we give them no value. The company plans to ask the FDA and European regulators how to redesign its program around a narrower group of patients. A second Phase 3 trial (LEVEL-2, about 540 patients) began enrolling in December 2025 and the company expected to finish enrolling by the end of 2027. Our earlier estimate assumed the drug still had a real chance; this update removes that. The other main change is cash, which rose to $118.0 million at June 30, 2026 from $97.6 million at the end of 2025, because investors exercised warrants for about $44 million of financing in the first half. What the shares are backed by. At June 30, 2026 the company had $118.0 million of cash, no borrowings, and total liabilities of $8.1 million, all ordinary payables and accruals that we treat as part of running the business. The 10-K gave no going-concern warning. We estimate about 52 million shares once pre-funded warrants (which cost almost nothing to exercise) are counted; this is an estimate from the reported weighted average of 50.9 million shares in the second quarter and the shares issued on warrant exercises. Outstanding warrants (about 7.5 million at June 30) and options carry exercise prices above the values below, so we assume no extra cash or shares from them. The August 2024 warrants struck at $4.50 also expire 30 trading days after the LEVEL result, and any cash from them is not counted. Bear case, $0.17 per share. Management follows its plan to run the LEVEL-2 program until the money is gone. The company's own second-quarter guidance said cash lasts to the second quarter of 2028 on its plan, and the first trial has already missed on the same walking-distance goal. We assume LEVEL-2 does not rescue the drug, and about $10 million remains after spending and wind-down. That is worth about $9.0 million discounted at 6%, against no debt, or about $0.17 per share. Base case, $1.09 per share. We assume management spends about $50 million over the next twelve months (close to the first-half 2026 pace of roughly $47 million a year) while it consults regulators, then stops and keeps roughly $60 million after about $8 million of wind-down and commitments. That is about $56.6 million discounted at 6%, against no debt, or about $1.09 per share. No value is given to a drug approval, since no approval path is evidenced after this trial result. Bull case, $1.79 per share. Management concludes quickly that the program cannot go on, spends about $12 million more this year and about $10 million on wind-down, and keeps roughly $96 million. That is about $93.2 million discounted at 6%, against no debt, or about $1.79 per share. Even in this case we give no value to a future drug, because the subgroup results do not yet meet the bar of evidence we require; only cash that has been shown is counted. What would make us wrong. If a redesigned trial in a narrowed patient group succeeded, the drug could be worth far more than cash, and none of that is in these numbers. Milestones owed to Orion (up to $10.0 million on US approval, $5.0 million on other approval, and up to $45.0 million of sales milestones) only arise if the drug is approved, so they do not affect these values. The largest risk on the other side is how much of the cash management chooses to spend before deciding to stop; that spending choice is the difference between our bear and bull cases. Owner earnings are negative for every year we could measure (about a $1.34 per share loss in 2025, mostly cash burn and stock compensation), and the estimates above rest on cash, not earnings.