Why American Coastal Insurance Stock Dived by 17% Today
The weekend can't come soon enough for American Coastal Insurance (NASDAQ:ACIC) stock. It took quite a beating on the exchange Thursday, closing more than 17% lower. Investor ire came from news of a new, relatively large-scale share issue. The share price's steep decline did not mirror the performance of the benchmark S 500 index, which landed 0.6% in positive territory that day.
Late Wednesday, American Coastal announced that it plans to issue up to 8 million shares of its common stock in an at-the-market (ATM) public offering. ATM issues tend to take place piecemeal, with share sales taking place from time to time, rather than all at once.
The insurer is selling the stock through a distribution agreement with Raymond James Financial (NYSE: RJF). For its work, Raymond James will earn a commission of up to 3% of the gross proceeds derived from the issue.
Source Fool.com
