Paul BIONDI がリツイート
I am not one who is prone to blame stock price movement on manipulation.
That being said, the price action on $SOFI on Monday and especially Tuesday is extremely suspicious.
SoFi has had some bad days, but Tuesday's -15.3% move was the worst day ever in the history of the stock. Through the entire 2021-2022 bear market, the $1.1B senior convertible note offering, SPAC lockup nonsense, Technisys acquisition and the dilution that came with it, the $UPST massive misses that dragged the stock downward, huge CPI prints, four straight 75 bps rate hikes, neverending student loan moratorium extensions, a banking crisis, and more, SoFi had never had as bad of a day as Tuesday.
What catalyzed the huge selfoff? A $750M convertible note offering and retirement of $600M of debt through an equity raise. The news has some negative and some positive aspects to it, but is probably somewhat positive to neutral on the whole. Yet somehow that led to the largest single day drop ever.
What would be the incentive to drop the stock price?
Those who are financing the $750M notes knew that the conversion price would be determined by Tuesday's closing price. Every cent the stock went down is more shares for them in the future.
Let's assume for a second that by 2029, SoFi manages to get back to its all time high of $25. If the conversion price were pegged to the $8.99 price it closed at last Friday, the $750M investment would end up being worth $1.6B.
However, because the conversation is calculated from $7.27, that same investment turns into $2.0B. Convertible note holders will end up with 24% more shares at the end of the day than they would have gotten if the conversion price was from two days earlier.
As the late Charlie Munger famously said, "Show me the incentive and I will show you the outcome."
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