Why Is Sonnet BioTherapeutics (SONN) Stock Down 33% Today?

  • Sonnet BioTherapeutics (SONN) stock is falling after revealing details of a public offering.
  • The company is selling 2,843,750 shares for $1.60 each.
  • That’s priced below its previous closing and includes warrants for another 5,687,500 shares.
SONN Stock - Why Is Sonnet BioTherapeutics (SONN) Stock Down 33% Today?

Source: Shidlovski / Shutterstock.com

Sonnet BioTherapeutics (NASDAQ:SONN) stock is falling on Wednesday after the biotechnology company revealed details of a public share offering.

That public stock offering has Sonnet BioTherapeutics selling 2,843,750 shares of SONN stock at a price of $1.60 each. The shares also each come with two warrants to acquire another 5,687,500 shares of the company’s stock.

Sonnet BioTherapeutics says that it expects gross proceeds from this stock offering to total $4.55 million. The company says that it will use this money to fund research and development, as well as for working capital and general corporate purposes.

What This Means for SONN Stock Investors

A public stock offering increases the total number of shares outstanding. Doing this also dilutes the stakes of current shareholders in a company. With that in mind, it makes sense that investors wouldn’t be happy about today’s news.

To go along with that, the stock offering is priced at $1.60 per share. That’s a significant discount compared to Sonnet BioTherapeutics’ closing price of $1.81 per share on Tuesday.

Investors will also note that SONN stock is seeing heavy trading today. As of this writing, more than 100,000 shares have changed hands. For comparison, its daily average trading volume is about 72,000 shares.

SONN stock is down 32.7% as of Wednesday morning.

Investors looking for more of the hottest stock market stories today are in the right place!

InvestorPlace offers up all of the latest and greatest stock market coverage that traders need for Wednesday! A few examples include why shares of Reshape Lifesciences (NASDAQ:RSLS) and Abri SPAC I (NASDAQ:ASPA) stock are up today, as well as the biggest pre-market stock movers this morning. All of that news is ready to go down below!

More Wednesday Stock Market News

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, 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.

Article printed from InvestorPlace Media, https://investorplace.com/2023/10/why-is-sonnet-biotherapeutics-sonn-stock-down-33-today/.

©2024 InvestorPlace Media, LLC