Why Poet Technologies Is Plummeting Today
Key Points
Poet stock is moving lower today in conjunction with bearish momentum for the broader market.
The company also announced that it completed its deal for a dilutive $400 million new funding round.
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Poet Technologies (NASDAQ: POET) stock is moving lower in Monday's trading. The company's share price was down 12.6% as of 2:05 p.m. ET. The S&P 500 was down 0.3% at the same point in the daily session, and the Nasdaq Composite was off 0.7%.
The broader market is seeing bearish momentum in today's session, and many growth-dependent tech stocks are seeing particularly large pullbacks. Poet stock is likely also under pressure due to investors taking profits and news that the company has completed a dilutive new fundraising round.
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Poet stock pulls back
Poet's valuation pullback in recent trading comes on the heels of a massive run-up. The company's share price skyrocketed last week following news that the company had inked a deal with Lumilens that could be worth more than $500 million. Despite some big sell-offs recently, the stock is still up roughly 120% year to date.
With the broader market moving lower today, Poet is getting hit with another round of sell-offs. Factors including some production headwinds in the memory-chip market, rising oil prices, and rising bond yields are all contributing to the market's pullback today.
Poet completes $400 million funding deal
Before the market opened this morning, Poet published a press release announcing that it closed its deal to sell roughly 19.05 million shares of its common stock and a warrant granting the right to purchase roughly 19.05 million additional shares of common stock. The sale was conducted to a single, unnamed institutional investor and allowed the company to raise roughly $400 million. With the company making aggressive fundraising moves through the sale of new stock, shareholders are facing significant dilution.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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