One of the biggest movers in today’s market is Exela Technologies (NASDAQ:XELA). Today’s impressive move of more than 30% in XELA stock is certainly turning heads, as the company announced a big round of funding.
Exela’s management team noted that the company has increased its existing securitization facility to $185 million. This amendment stipulates the company will have an additional $51 million of financing available to it via a funding deal with B. Riley (NASDAQ:RILY).
Exela is a global business process automation leader. As such, the company’s stock price price chart looks as one would expect in recent years.
That said, this financing round is clearly inspiring investors to consider this stock once again. Let’s dive into what investors should make of this news.
Why Is XELA Stock Surging Today?
There are a number of reasons why this funding deal is notable. First, B. Riley is a respected outfit, meaning this deal suggests the company believes it will continue in good standing for the long term. Additionally, this level of financing is typically very difficult to pull off for a company of Exela’s size. At the time of writing, the company has a very small market capitalization of less than $8 million.
In order for a company like Exela to execute on its plans, financing is a key piece of the puzzle that needed to be solved. Accordingly, with this monkey off the management team’s back, investors may look forward to how the company executes in the future.
As with all small-cap stocks, there’s a tremendous amount of risk involved in investing in such companies. Indeed, today’s impressive increase shows just how volatile day to day moves can be. That said, for those building a small cap portfolio, this is certainly a stock to watch moving forward.
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On the date of publication, Chris MacDonald 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.