LFST - LifeStance: Selloff Opens Buying Opportunity Thanks To Price/Value Dislocation

2024-05-23 09:25:54 ET

Summary

• Shares of LifeStance Health plunged over 20% after a secondary offering of 20 million shares at $6.25 per share.
• LifeStance's Q1 earnings showed strong sales growth and projected double-digit top-line growth for the next three years.
• The sell-off has created a buying opportunity as LFST stock's valuation is dislocated from its potential growth and is trading at a discount.

Investment Summary

Shares of LifeStance Health (LFST) plunged more than 20% overnight after the company announced a secondary public offering of 20 million shares, priced at $6.25 apiece.

At the start of the week, the stock was selling at the c.$7.40 mark. However, news of the secondary offering yesterday wiped more than $650 million in capitalisation from the company’s market value in a single session. LFST now trades around its November 2023 lows, having struggled immensely since it's listing in June 2021....

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