SEEKING ALPHA - Mar 10 - MeetMe stock exploded to $6 when the company delivered its Q4. But the stock fell quickly. Here is why... MeetMe is doing an underwritten public offering of 8M shares of its common stock at a public offering price of $5.00 per share. This was a 16% discount to where shares were trading before the announcement. The company effectively by proceeding with this price point shaved 16% of its market cap with a single press release. They need to ensure there are buyers so that way there is maximum cash raised. At this discount it is assured. This is a real hit to shareholders, especially those who bought the momentum this week. Bottom line here is that MeetMe continues to be a winner, but this is an unfortunate short-term slap to the face. No one holding a stock wants to see all of their gains given back in a day.
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Summarized by the Courtland Brooks team
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