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STAG Industrial, Inc. (STAG - Free Report) recently upsized its public offering by 750,000 shares to 8,750,000 shares of its common stock, consisting of 5,600,000 shares offered by the company and 3,150,000 shares offered on a forward basis.
Earlier, the company had announced a public offering of 8 million shares, comprising 5.6 million shares offered by STAG Industrial and 2.4 million shares offered through a forward sale arrangement.
Subject to customary closing norms, the offering is anticipated to close on Jan 16. The company expects to raise gross proceeds of nearly $274.8 million from this offering. Moreover, the forward purchaser and STAG Industrial have offered the underwriters a 30-day option to buy up to an additional 1,312,500 shares.
Net proceeds from the offering will be used to pursue acquisition opportunities, reduce outstanding debt under its $500-million unsecured credit facility, as well as for working capital and other general corporate purposes.
For this offering, STAG Industrial will enter into forward sale agreements, per which the forward purchasers are likely to borrow and sell the shares to the underwriters. Subject to its right to elect cash or net share settlement, the company anticipates to deliver the shares no later than Jan 13, 2021, in exchange for cash proceeds amounting to the applicable forward sale price.
Notably, a forward sale arrangement will enable it to lock in the price of such shares at the time of offering pricing, while at the same time delaying share issuance and the receipt of net proceeds until a funding requirement has occurred.
Also, the common stock offering will boost the company's financial flexibility and help meet its financial obligations. Moreover, it will open up ample scope for deploying capital for long-term growth opportunities.
Per a report from CBRE Group (CBRE - Free Report) , rent growth is projected at 5% for 2020, and will be fueled by newer product and infill industrial space in supply-constrained markets. Also, increasing e-commerce penetration, as well as need for last-mile and same-day delivery options have been propelling demand for industrial/warehouse spaces.
This is likely to boost demand for light-industrial warehouses of less than 120,000 square feet. Also, with space being significantly limited in the smaller-size section, growth in rent is projected to continue in the current year.
This, in turn, is likely to keep spurring demand for industrial/warehouse spaces, enabling industrial landlords to enjoy a favorable market environment. As for STAG Industrial, the company’s moves to expand its industrial portfolio position it well to capture benefits of the upbeat industrial market conditions.
However, as the company issues new shares, bringing additional shares to the market will likely result in earnings dilution.
Over the past six months, shares of this Zacks Rank #3 (Hold) company have rallied 3.8% compared with the industry's gain of 2%.
Stocks to Consider
Boston Properties, Inc. (BXP - Free Report) currently carries a Zacks Rank of 2 (Buy) and has gained 15.5% in the past year. The company’s funds from operation (FFO) per share estimate for 2020 has been revised marginally upward to $7.53 in two months’ time. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CyrusOne Inc’s Zacks Consensus Estimate for the current-year FFO per share moved slightly north to $3.92 in the past two months. It carries a Zacks Rank of 2, at present. The stock has rallied 21.2% over the trailing 12-month period.
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STAG Industrial (STAG) Upsizes & Prices 8.75M Share Offering
STAG Industrial, Inc. (STAG - Free Report) recently upsized its public offering by 750,000 shares to 8,750,000 shares of its common stock, consisting of 5,600,000 shares offered by the company and 3,150,000 shares offered on a forward basis.
Earlier, the company had announced a public offering of 8 million shares, comprising 5.6 million shares offered by STAG Industrial and 2.4 million shares offered through a forward sale arrangement.
Subject to customary closing norms, the offering is anticipated to close on Jan 16. The company expects to raise gross proceeds of nearly $274.8 million from this offering. Moreover, the forward purchaser and STAG Industrial have offered the underwriters a 30-day option to buy up to an additional 1,312,500 shares.
Net proceeds from the offering will be used to pursue acquisition opportunities, reduce outstanding debt under its $500-million unsecured credit facility, as well as for working capital and other general corporate purposes.
For this offering, STAG Industrial will enter into forward sale agreements, per which the forward purchasers are likely to borrow and sell the shares to the underwriters. Subject to its right to elect cash or net share settlement, the company anticipates to deliver the shares no later than Jan 13, 2021, in exchange for cash proceeds amounting to the applicable forward sale price.
Notably, a forward sale arrangement will enable it to lock in the price of such shares at the time of offering pricing, while at the same time delaying share issuance and the receipt of net proceeds until a funding requirement has occurred.
Also, the common stock offering will boost the company's financial flexibility and help meet its financial obligations. Moreover, it will open up ample scope for deploying capital for long-term growth opportunities.
Per a report from CBRE Group (CBRE - Free Report) , rent growth is projected at 5% for 2020, and will be fueled by newer product and infill industrial space in supply-constrained markets. Also, increasing e-commerce penetration, as well as need for last-mile and same-day delivery options have been propelling demand for industrial/warehouse spaces.
This is likely to boost demand for light-industrial warehouses of less than 120,000 square feet. Also, with space being significantly limited in the smaller-size section, growth in rent is projected to continue in the current year.
This, in turn, is likely to keep spurring demand for industrial/warehouse spaces, enabling industrial landlords to enjoy a favorable market environment. As for STAG Industrial, the company’s moves to expand its industrial portfolio position it well to capture benefits of the upbeat industrial market conditions.
However, as the company issues new shares, bringing additional shares to the market will likely result in earnings dilution.
Over the past six months, shares of this Zacks Rank #3 (Hold) company have rallied 3.8% compared with the industry's gain of 2%.
Stocks to Consider
Boston Properties, Inc. (BXP - Free Report) currently carries a Zacks Rank of 2 (Buy) and has gained 15.5% in the past year. The company’s funds from operation (FFO) per share estimate for 2020 has been revised marginally upward to $7.53 in two months’ time. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CyrusOne Inc’s Zacks Consensus Estimate for the current-year FFO per share moved slightly north to $3.92 in the past two months. It carries a Zacks Rank of 2, at present. The stock has rallied 21.2% over the trailing 12-month period.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>