Chewy Stock Is Sliding After Hours: What's Going On?
Portfolio Pulse from Adam Eckert
Chewy Inc (NYSE:CHWY) shares fell in after-hours trading following the announcement of a $500 million public offering by a selling stockholder, Buddy Chester Sub LLC, affiliated with BC Partners Advisors LP. Chewy will repurchase $300 million of its stock from the selling stockholder, which will be canceled and retired.
September 19, 2024 | 9:10 pm
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Chewy's stock declined after-hours due to a $500 million public offering by a major shareholder. The company will repurchase $300 million of its stock, which will be canceled and retired.
The announcement of a large public offering by a major shareholder typically pressures the stock price downward due to potential dilution concerns, even though Chewy itself is not issuing new shares. The concurrent repurchase of $300 million worth of stock by Chewy may partially offset this negative sentiment, but the immediate market reaction was negative, as evidenced by the 3.09% drop in after-hours trading.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100