Why Symbotic Plunged Nearly 30% in December

Shares of warehouse automation platform Symbotic (NASDAQ: SYM) fell 29% in December, according to data from S&P Global Market Intelligence.

Symbotic had come into December riding high, after the company reported an impressive third quarter in late November. That capped off a terrific year for the stock, which, despite the December sell-off, finished up just over 150% for the year.

However, management, along with a large shareholder, decided to capitalize on that stock surge to raise money, diluting shareholders through an equity sale in early December.

Symbotic raises cash, and SoftBank cashes out

On Dec. 3, Symbotic announced a 10 million share-sale offering, which was later priced at $55 per share. Symbotic had been trading at over $85 per share on the first day of the month and just under $73 per share on Dec. 3. So, the offering price marked a significant discount from the Dec. 3 stock price, in order to attract buyers at scale.

Notably, the 10 million shares were divided into a 6.5 million share block sold by the company for general corporate purposes, and a 3.5 million share block sold by SoftBank (OTC: SFTB.Y), which retained the proceeds.

Investors shouldn't necessarily worry about SoftBank cashing out. SoftBank owned nearly 40 million shares of Symbotic as of Sept. 30, so the share sale only amounted to less than 10% of its stake. SoftBank has also been raising cash from many of its winners in 2025, including Nvidia and Arm Holdings, to fund its $41 billion OpenAI investment commitment made at the beginning of the year.

So, investors shouldn't think that SoftBank's sale indicates a lack of faith in Symbotic. Nonetheless, it was somewhat curious that Symbotic chose to raise money in conjunction with SoftBank. Symbotic ended its fiscal fourth quarter in September with nearly $1.25 billion in cash and equivalents, and also had positive free cash flow last year.

Image source: Getty Images.

Is this an acknowledgement of an expensive stock?

Given that Symbotic only raised $358 million, which it doesn't appear to need, it seems that Symbotic either wanted to help Softbank with its share sale, or thought the stock had run up to an overpriced valuation, making an equity sale attractive.

On the surface, Symbotic's stock appears to be expensive, trading at around 18.6 times its sales from the previous year. That's quite a high valuation, and usually reserved for high-growth software stocks, not hardware-oriented robotics players.

Nevertheless, Symbotic appears to be firing on all cylinders. Management is forecasting strong 27% growth at the midpoint for the upcoming quarter, which would mark a slight acceleration over the 26% growth achieved in the last fiscal year.

Additionally, management noted the company landed its first healthcare client last quarter, marking the beginning of a potentially significant market opportunity, as well as a diversification away from the e-commerce warehouse automation market, particularly with Walmart (NASDAQ: WMT), which accounted for nearly 85% of Symbotic's revenue last year.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia, Symbotic, and Walmart. The Motley Fool has a disclosure policy.