BTIG turned cautious on Drive Shack ( NYSE: DS ) with a downgrade on Monday to a Neutral rating from Buy.
The firm said it continue to believe in the Drive Shack ( DS ) concept and overall category growth, but warned that an imperative capital raise has failed to materialize.
"The lack of capital raise, coupled with recent delay in 10-Q filing, and potential delisting leads us to be more cautious. With that said, we believe the company has several capital raise options including the sale of its New Mexico golf course, executing a sale-leaseback on the Raleigh Drive Shack, and or monetization of its traditional golf business."
Saleh and team also see additional uncertainty in the company's ability to develop Puttery locations without the capital raise and is uncomfortable with what it says is a lack of transparency and communication.
BTIG noted that it is concerned that the company is running out of capital and have been unable to reach management to gain clarity on the situation.
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Drive Shack is downgraded at BTIG because a capital raise is still missing