Why Is Volcon (VLCN) Stock Down 37% Today?


  • A public equity offering is hitting Volcon (VLCN) stock today.
  • Investors aren’t reacting well to the news.
  • This has shares falling alongside heavy trading.
VLCN Stock - Why Is Volcon (VLCN) Stock Down 37% Today?

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Volcon (NASDAQ:VLCN) stock is taking a beating on Monday after the all-electric powersports company announced a public equity offering.

Volcon is intending to offer securities as part of a firm commitment underwritten public offering. That includes $5 million worth of nine-month convertible senior notes. They also include warrants for another 5.5 million shares with an exercise price of $1.09 per share.

Additionally, Volcon is exchanging $27.2 million in convertible senior notes due on February 24, 2024, for two senior convertible notes due Feb. 24, 2024. These have an exercise price of $1.09 per share.

Finally, Volcon intends to exchange warrants for 9,057,971 of VLCN stock with an exercise price of $2.85 per share. This will trade them for warrants for 17,057,971 shares, also with an exercise price of $1.09 per share.

How This Affects VLCN Stock

VLCN stock is falling on Monday alongside the public equity offering announcement. That makes sense as the company is basically shifting around its stock and warrants for additional funds. This increases the number of outstanding shares, which investors typically don’t react well to.

In this case, investors are reacting by selling shares of VLCN stock today. As of this writing, more than 455,000 shares of VLCN stock were moving today. For the record, the company’s daily average trading volume is closer to 61,000 shares.

VLCN stock is down 36.7% as of Monday morning.

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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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