CorMedix Inc. (NYSEAMERICAN: CRMD) is having an overwhelmingly rough start to the trading session this morning, and for good reason. The company announced a dilutive transaction that led to concerns among investors who are sending the stock tumbling down. Today, we’ll talk about:
- The offering;
- what we’re seeing from CRMD as a result; and
- what we’ll be watching for ahead.
CRMD Announces Offering
As mentioned above, CorMedix is having an incredibly rough start to the trading session this morning after the company announced that it would be moving forward with a dilutive transaction. In an SEC filing issued late yesterday, the company said that it plans on selling 14,990,585 shares of its common stock, issuable upon the exercise of warrents held an existing stockholder.
In the filing, CRMD said that there has been no underwriter or other person engaged to facilitate the sale of shares or common stock in this offering quite yet. Also, CRMD said that the company will be paying the cost of registering the shares covered in the prospectus as well as various other related expenses. The selling stockholders are responsible for all selling commissions, transfer taxes and other costs related to the offer and sale of shares of common stock.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that it’s important to keep a close eye on the news. After all, the news moves the market. In the case of CorMedix, the news proved to be overwhelmingly negative. After all, this transaction means that the shares of the stock will be diluted greatly, adding nearly 15 million shares to the pool. So, it comes as no surprise that upset investors are sending the stock tumbling in the market this morning. As is normally the case, our partners at Trade Ideas were the first to alert us to the declines. At the moment (9:40), CRMD is trading at $1.91 per share after a loss of $0.27 per share or 12.39% 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 CRMD. In particular, we’re interested in following this transaction and the use of the funds generated through the transaction as it is valued at about $15 million. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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