Why Is Edible Garden (EDBL) Stock Down 45% Today?


  • Edible Garden (EDBL) stock is dropping alongside a proposed public stock offering.
  • That makes sense as investors don’t normally react well to stock offerings.
  • This brings with it heavy trading to EDBL stock.
EDBL Stock - Why Is Edible Garden (EDBL) Stock Down 45% Today?

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Edible Garden (NASDAQ:EDBL) stock is falling hard on Friday as investors react to a proposed public stock offering.

Edible Garden is planning a public offering that would see the company raise no more than $4,017,525. This offering would include units containing shares, warrants, as well as pre-funded warrants exercisable for one share of EDBL stock.

In addition to this, the company is planning for an over-allotment option. This will allow underwriters of the public offering to purchase additional units for the same price as the public offering.

What This Means for EDBL Stock

A public stock offering means that EDBL will increase its total number of outstanding shares. That’s through the shares issued in the offering, as well as the exercisable warrants, which add more outstanding shares.

With these outstanding shares being sold by the company, it will generate funds for use. The company likely intends to use the money from this public stock offering to continue general operations.

EDBL stock is falling today as traders don’t often respond well to public offerings. That makes sense as it dilutes current stakes in the company. Also, the offerings are typically priced below the market value to attract new investors.

In the case of EDBL stock, today’s news also brings heavy trading. That has some 600,000 shares on the move as of this writing. For the record, the company’s daily average trading volume is about 85,000 shares.

EDBL stock is down 44.6% as of Friday morning.

Investors looking for more of the latest stock market news are in the right place!

We’ve got all of the most recent stock market coverage for Friday! A few examples include what’s moving shares of Genetic Technologies (NASDAQ:GENE) and Reshape Lifesciences (NASDAQ:RSLS), as well as the biggest pre-market stock movers from this morning. You can read more on these matters at the links below!

More Friday Stock Market News

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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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