Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of liquefied natural gas company Cheniere Energy
So what: The previously announced offering of 36.3 million shares was priced at $8.35 per share, which is nearly 11% below yesterday's close of $9.34. Given that big discount, as well as the sheer size of the offering, investors are obviously concerned about the sale's dilutive potential.
Now what: Wall Street expects Cheniere to raise about $300 million from the offering, most of which will be used to pay off its term loan due early next year. But while some of the short-term financing risk has been lifted, the below-market sale serves as another reminder of the company's still-precarious financial position. With billions of debt still on the balance sheet, the stock is probably best left to more speculative types to play with.
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