Phunware Stock Is Tanking Wednesday: What's Going On?
Portfolio Pulse from Adam Eckert
Phunware Inc (NASDAQ:PHUN) shares plummeted after announcing a $7 million registered direct offering of approximately 87.5 million shares at 8 cents per share. The offering was priced at-the-market under Nasdaq rules. Proceeds are intended for working capital and corporate purposes, including product initiatives. This follows a surge in Phunware shares due to former President Donald Trump's Iowa caucus win, recalling Phunware's past work on Trump's 2020 campaign app. PHUN stock dropped 61.1% to $0.1648 post-announcement.
January 17, 2024 | 1:49 pm
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Phunware's stock price fell sharply by 61.1% to $0.1648 after the company announced a significant direct offering at a price substantially below the previous close.
The direct offering of Phunware's shares at 8 cents per share, which is significantly lower than the closing price of 42 cents on Tuesday, is likely to have a dilutive effect on existing shareholders. The sharp decline in stock price reflects investor concerns over dilution and the potential overhang of new shares on the market. The timing after a recent surge due to political news also suggests a strategic move to capitalize on the higher stock price, which may further affect investor sentiment.
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IMPORTANCE 90
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