Smart Money Believes Magnite Stock Can 10X in 4 Years. Can It?
Share prices of supply-side advertising-technology (adtech) specialist Magnite (NASDAQ: MGNI) have plummeted 86% from their all-time high over one year ago. And it's something that institutional investors, so-called "smart money," didn't think would happen. In fact, they made a bet Magnite could reach $91.26 per share by 2026, more than 10 times where the stock trades today.
In this article, we'll look at why smart money believed Magnite could hit this price. We'll also discuss what happens to the company if the price target isn't reached.
In March 2021, Magnite took on $400 million in convertible-note debt. At just a 0.25% interest rate, grabbing cheap money made sense. However, lenders were poised to make little in interest. Instead, they made the transaction in hopes the debt would convert into stock, allowing them to participate in Magnite's upside.
Source Fool.com
