![]() That cash is inside the company and was value accretive to extant shareholders - sales of stock above prevailing prices are such, not dilutive.īut then which came first? Having a small company that could do with more capital, seeing that the price has soared for whatever reason and then issuing stock, that's just good business. Of course, as a result, GDC is now worth more than it was. The net proceeds were in the $9 million range. That is, of course, remarkably well above the previous trading range. They were able to get away a combination of stock and warrants to the tune of 844,000 units at a price of $8 and change. Then came that 1,600% to 800% stock price surge. The stock was trading in a very generous $2.50 to $3.00 range. No, we don't know which way around it is either.īefore that leap in the stock price GDC had some $10,000 in cash and $75,000 in quarterly revenues. The other way around it's highly illegal. What we need to know to be able to evaluate this is which came first? The plan to raise capital? Or the jump in the stock price? One way around this is just entirely sensible business planning. GDC used this bump in the stock price to raise capital. Well, OK, such things happen in odd corners of the market now and again.īut there's one other thing here. Somewhere between rumours of great deals and high values to manias of nothing but a momentum trade on such rumours. There has been a wave of excitement about small cap Chinese tech and financial stocks recently. We assigned it to just one of those things. Except the obvious fact that it did jump that much intraday before falling back to only 800% up on the full trading day. ![]() As we said back then about GDC stock there was really no reason at all why it should jump 1,600% in one day. GD Culture Group (NASDAQ: GDC) was an interesting little tale back at the beginning of this month.
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