A shopper carrying an Express bag while walking around Center City, Philadelphia, Pennsylvania, USA, on Friday, June 24, 2016.
Charles Mostler | Bloomberg | Getty Images
Retailer stock Express It fell more than 22% on Thursday after clothing retailers announced plans to sell up to 15 million shares.
Express plans to sell shares that may account for more than 22% of the outstanding shares through an initial public offering “on the market.” This means that newly issued shares will be sold at market prices from time to time. The advantage is that Express has control over when and how much inventory it will serve.
In a press releaseExpress said it plans to use the revenue for general corporate purposes, such as repayment of debt and investment in e-commerce.
Express’s share price has risen nearly 110% in the past month.So-called Meme stockIs generally shunned by Wall Street, but individual investors are cheering on online forums such as Reddit’s WallStreetBets.
Roxanne Meyer, managing director of MKM Partners, told clients that daily trading volumes on Express stocks are still well above historic levels, supported by Reddit speculation.
By 10:30 EST, approximately 11.5 million Express shares had already changed ownership. The average daily turnover over the last 10 days was around 27 million shares. Express’s share price has risen by more than 615% so far as of Wednesday’s closing market price. The retailer has a market value of $ 349.5 million.
Express stocks soared early Thursday morning after retailers reported better-than-expected results First quarter financial resultsThe company’s business reached an inflection point after Easter as more consumers were vaccinated and the state began to lift Covid-related restrictions. Also, people returned to stores and were based on opportunities. I was also seen buying work-related apparel products.
However, MKM’s Meyer said store congestion, continued slowdown in dressing demand, and delayed product shipments are still headwinds for mall-based retailers. Express operates more than 500 retail and factory outlet stores in the United States and Puerto Rico.
Last year, in the midst of a pandemic of the new coronavirus, Express was on the attention list of many analysts as a potentially bankrupt retailer. But besides the court restructuring, the company was able to come up with additional funding to keep the business alive and survive the health crisis.
According to FactSet data, about 7.7% of Express’s outstanding shares are short-sold. Short selling expects to borrow stock from an investment bank, sell it, buy it back at a cheaper price, and put the difference back in your pocket.
The latest initial public offering may bring additional liquidity to Express. Clothing retailers aren’t the only ones to use the newly earned interest on their shares to raise money. AMC also announced that it plans to sell more than 11 million shares.Send stock of cinema chains that fall.
Express inventory plummets after retailers announce plans to sell inventory
Source link Express inventory plummets after retailers announce plans to sell inventory