TESARO (TSRO) Stock: Here’s Why It’s Falling


TESARO is having an overwhelmingly rough start to the trading session today. After starting the day off well into the red, the stock hasn’t even seemed to make an attempt to head toward the green. Today, we’ll talk about what we’re seeing from the stock, why, and what we will be watching for with regard to TSRO ahead.

What We’re Seeing From TSRO

As mentioned above, today isn’t off to a great start for TESARO. With the opening bell, the stock found itself in the red with a ton of ground to make up. However, it hasn’t been able to make up anything, and the losses just seem to grow. Currently (9:55), TSRO is trading at $130.25 per share after a loss of $18.25 per share (12.29%) thus far today.

Why The Stock Is Falling

As normal, as soon as we noticed the losses on TSRO, the CNA Finance team started digging to see what was causing the movement. It didn’t take much digging at all to find this story. The reason the stock is falling has to do with a public offering.

Essentially, TESARO has decided that it’s time to raise capital for the company. In order to do so, they have issued more shares and offered them for sale. At the end of the day, while this does bring money into the company, it also dilutes the shares that are already outstanding, so investors are never too happy about public offerings.

What We’ll Be Watching For Ahead

The truth is that I’m not expecting TSRO to fall too much further here. While investors don’t generally like public offerings, they do have their place. At the end of the day, we need to look at the bright side. As a result of this offering, TSRO will have the capital it needs to grow. With that said, buying the dip may be a smart move, as we’ll be looking for gains ahead.

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[Image Courtesy of Wikipedia]

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