ToughBuilt (NASDAQ:TBLT) stock is falling on Friday following the tool company revealing a proposed public stock offering.
That proposed public stock offering is priced at $6 million. It includes 3.16 million shares of TBLT stock and prices them at $1.90 each. Included with each share purchase is a warrant exercisable for the same $1.90 price.
It’s easy to understand why investors aren’t happy about the public stock offering. First off, any public offering is going to dilute a shareholder’s stake in a company. Secondly, they often value the shares below their current trading value.
That’s what’s happening to TBLT stock today with the $1.90 price for shares in its public offering. That’s well below the stock’s closing price of $3.05 per share on Thursday. As such, traders are selling off shares, which has dropped TBLT down to about $1.52 as of this writing.
With investors selling their shares of TBLT stock today comes heavy trading. As of this writing, some 5 million shares of the stock have changed hands. That’s well above the company’s daily average trading volume of about 186,000 shares.
TBLT stock is down 50.2% as of Friday morning and is down 97.4% since the start of the year.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.