Why Kinetik (KNTK) Shares Are Trading Lower
Portfolio Pulse from Henry Khederian
Kinetik Holdings Inc (NYSE:KNTK) shares dropped 3.8% after announcing an increased secondary offering size to 6.5 million shares at $31.50 each. Apache Midstream LLC, a subsidiary of Apache Corporation, is the selling stockholder. Kinetik's officers and directors, including the CEO, plan to purchase 63,492 shares at the offering price. Kinetik will not receive any proceeds from the sale by Apache Midstream. KNTK's 52-week range is $26.32 to $37.17.
December 12, 2023 | 4:25 pm
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Kinetik's stock price fell due to the increased secondary offering size, indicating dilution for existing shareholders. The offering price is below the current trading price, which may put downward pressure on the stock.
The increase in the secondary offering size and the offering price being set below the current market price typically leads to dilution of existing shares, which can cause the stock price to drop in the short term. The fact that the company's officers and directors are buying shares could be seen as a positive sign, but it is not enough to offset the negative impact of the dilution.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100