Posted 3/5/2024, 5:57:25 PM
SoFi Stock Drops As Company Announces $750 Million Debt Deal That Could Dilute Shares
- SoFi stock dropped 11.5% today after the company announced plans to take on $750 million in new debt
- The debt is convertible, meaning it could dilute shareholders if converted to stock
- SoFi says it will use some proceeds to reduce higher-cost preferred stock dividends
- Additional proceeds will go towards "capped call transactions" to reduce potential dilution
- Despite short-term negative reaction, the debt could decrease costs and 2024 profits are still expected to be $0.07 per share