Why U Power Stock (UCAR) Is Getting Obliterated
Portfolio Pulse from Henry Khederian
U Power Ltd (NASDAQ:UCAR), a Chinese vehicle services company, is issuing 10 million units at $1.20 each to raise $12 million. The offering includes shares and warrants, aiming to fund acquisitions of battery swapping companies and meet general corporate needs. The offering is set to close around December 6. UCAR's 52-week range is between $0.65 and $75.00.
December 04, 2023 | 4:24 pm
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U Power Ltd is raising $12 million through an offering at a price of $1.20 per unit, which may dilute current shareholders and put downward pressure on the stock price in the short term.
The announcement of a new stock and warrant offering typically leads to concerns about dilution for existing shareholders, which can cause the stock price to drop in the short term. Given the size of the offering relative to the company's market capitalization and the discount at which the units are being offered, it is likely to have a negative impact on UCAR's stock price.
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