Aquabounty Technologies Inc (NASDAQ: AQB) is having a horrible day in the market today, and for good reason. The company announced a dilutive offering, upsetting investors who are pushing the stock down. Today, we’ll talk about:
- The offering news;
- what we’re seeing from AQB stock as a result; and
- what we’ll be watching for ahead.
AQB Tanks On Dilutive Offering
As mentioned above, AquaBounty Technologies is having a horrible day in the market today after announcing a dilutive offering. The announcement came by way of press release early this morning.
In the release, the company announced the pricing of a previously announced offering of 3,345,282 shares of common stock. The company said that the price of the offering will be $2.25 per share.
It is expected that the transaction will generate gross proceeds in the amount of about $7.5 million. Moreover, the transaction is expected to come to a close on March 21, 2019.
In the release, AQB said that it has also granted the underwriters of the offering a 45-day option to purchase up to 501,792 additional shares of common stock. The additional shares may be purchased at the public offering price minus underwriting discounts and commissions.
AQB said that it intends on using the net proceeds of the offering for working capital costs. In particular, it plans on funding the growth in its first batches of fish at its Indiana and Rollo Bay farm sites as well as other general corporate purposes.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. When it comes to Aquabounty Technologies, the news proved to be upsetting.
After all, the offering price represented a steep discount to the current trading price of the stock. Not to mention that the transaction is an incredibly dilutive one.
So, it’s not surprising to see that upset investors are pushing the stock on a run for the bottom. As is normally the case, our partners at Trade Ideas were the first to alert us to the movement. Currently (11:42), AQB is trading at $2.24 per share after a loss of $0.56 per share or 20.00% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on AQB. In particular, we’re interested in following the story surrounding the company’s continued work to expand and develop its pipeline of product candidates. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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