Prior to the dilution announcement, the Company was trading at around $12 a share with 24.5 million shares outstanding - a market cap of $294 million. If you add the 6.9 million shares just sold and divide the $294 million cap by 31.4 million shares, the price should be $9.36. Understanding that the investors bought at a discount as an incentive to invest in the Company, they were able to purchase these shares at $8. There is no company news that I am aware of, nor any change in the business prospects of the Company or the industry as a whole to warrant the stock price to decrease to $7.20. This slide is extremely overdone in my opinion.
I totally agree ... but I think there's something going on that we as investors or the general public don't know about. On paper this looks like a great investment. I loaded up with an average price of 7.82. I think I'm going to get out and sit on the sideline until the "knife finish falling". I'll keep this company on my radar, but worrying about losing more money is the last thing I want to think about going into the holidays. Happy Holidays to everyone.
You need to understand who runs the company. I will bet they are already going around wall street looking for more money, expect even more shares to be offered next year at an even lower price the way this company spends money. One dilution leads to another wall street is not dumb!