Why LumiraDx Stock Is Crashing Today
Shares of LumiraDx (NASDAQ: LMDX) were crashing 19.9% lower as of 11:28 a.m. ET on Thursday. The steep decline came after the point-of-care diagnostics company announced the pricing of a public offering of 43 million shares at $1.75 each.
LumiraDx currently has around 207.5 million outstanding shares. The issuance of 43 million new shares will dilute the value of those existing shares by nearly 21%. The stock fell by only 13% in the two days after the company first announced its public offering on Tuesday.
At that time, LumiraDx indicated that it would only issue 40 million new shares. Also, investors didn't know the share price of the offering would be $1.75. This amount is more than 29% below LumiraDx's share price as of the market close on Monday. It's not surprising that the stock is falling even more today.
Source Fool.com
