Why Is Exela Technologies (XELA) Stock Up 30% Today?

  • Shares of Exela Technologies (XELA) stock are surging today on a funding announcement.
  • The company announced it had received an additional $51 million credit line from B. Riley (RILY).
  • This move lifts a key overhang for the stock, with investors clearly viewing the move positively.
XELA stock - Why Is Exela Technologies (XELA) Stock Up 30% Today?

Source: elenabsl/Shutterstock

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.

On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.

Read More:Penny Stocks — How to Profit Without Getting Scammed

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.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

Article printed from InvestorPlace Media, https://investorplace.com/2023/03/why-is-exela-technologies-xela-stock-up-30-today/.

©2023 InvestorPlace Media, LLC