SPPI - Why Spectrum Pharmaceuticals Is Plunging Today
Shares of Spectrum Pharmaceuticals (NASDAQ: SPPI), a small-cap biopharmaceutical company that focuses on cancer treatments, are down by 20.2% as of 12:18 p.m. EDT on Thursday, after the drugmaker announced the pricing of a public offering of common stock before the market opened today. Naturally, investors aren't thrilled at the prospect of Spectrum Pharmaceuticals diluting its shareholders, which explains why its stock is plunging today.
Spectrum Pharmaceuticals is offering 21,666,667 shares of its common stock for $3 per share. Also, the company is granting underwriters a 30-day option to purchase an additional 3,250,000 shares. It expects to raise about $65 million in gross proceeds through this public offering of common stock, which should close on Aug. 3. Note that at the end of yesterday's trading session, its shares were worth $3.88 apiece. As of this writing, they're down to roughly $3.08.
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