Why Aurora Cannabis, Kirkland Lake Gold, and CymaBay Therapeutics Slumped Today
Wall Street had a good session on Monday, celebrating a more optimistic view on trade and general economic prospects. Major merger and acquisition activity was also a highlight of the day. Yet some stocks ended up getting left out of the party and saw their shares sink precipitously. Aurora Cannabis (NYSE: ACB), Kirkland Lake Gold (NYSE: KL), and CymaBay Therapeutics (NASDAQ: CBAY) were among the worst performers. Here's why they did so poorly.
Shares of Aurora Cannabis dropped 7% after the marijuana company announced the pricing for conversion rights on convertible debentures that investors own. Holders of about 227 million Canadian dollars' worth of debt elected to use the conversion privilege under the debentures' terms. That'll result in roughly 69 million new shares getting issued at an effective price of CA$3.28 per share, which is below where the stock traded at the end of last week. Dilution has been a problem for Aurora, and with marijuana stocks in general having a lot of trouble, it's not obvious when Aurora's shares could start to move higher again.
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Source Fool.com
