Bumble Stock Is Looking for a New Match
The appeal of Bumble's (NASDAQ: BMBL) namesake dating app is that only women can make the first move by initiating contact in pairings that involve a man and a woman. Now we're seeing early investors making the first move by initiating a stock sale.
Bumble announced after Tuesday's market close that 15 million shares will be hitting the market in an underwritten public offering. It's not a dilutive transaction, since no new shares are being printed. It's just affiliates of Blackstone -- who took a majority stake in the company back in 2019 before helping take it public earlier this year -- looking to unload some shares.
The stock still took an initial hit on the news. Investors generally don't react well when a newly public company has a stock offering. Whether it's insiders or early investors moving on or a company taking advantage of a buoyant share price to raise more money at higher price points it's not a positive development. Even Bumble's situation -- with no new shares going out -- can't be spun as a positive. These 15 million shares held by Blackstone affiliates will increase the stock's float even if it doesn't pump up the actual outstanding share count. Naturally all of the proceeds left after the underwriters take their cut will go to the selling parties.
Source Fool.com
