On no news but a lot of activity on Stocktwits, Sidus Space (NASDAQ: SIDU) was up 290% over just two days in December. Perhaps equally crazy, 297 million shares exchanged hands on a single day. A real frenzy. This was the biggest SIDU stock price jump since June 2022 when the stock rose 430% over two days on news Sidus was “teammate” on a $3.5b NASA contract. So far, no significant amount of this $3.5b has come Sidus Space’s way. Even with the December gains, Sidus stock has fallen 99% since the NASA teammate news release.
On December 17th, after just closing a $7m stock sale just a month prior, Sidus was quick to announce another sale of 6,799,892 shares. Sidus appears to have moved quickly to raise cash and capitalize on the sudden increase in its stock price. Thinkequity again ran this deal and each share was offered at $2.07. This represented a severe discount (-63%) to market price of $5.60 at close of trading on December 17th.
Sidus Space’s stock price held more or less until the beginning of January. Thus whichever “accredited and institutional investors” ThinkEquity allowed to purchase these discounted shares stood to earn an instant fortune. Sidus Space packaged one warrant to buy one share at $2.25 for every two shares of stock (or pre-funded warrant) sold. Thus if all warrants exercised, Sidus Space could earn up to $21.7m before commissions and fees from this offering. This capital, with November’s raise, will provide Sidus enough cash to fund itself for nearly 18 months!
However, the real winners are clearly the investors who bought shares from ThinkEquity. These investors stood to earn $33.3m in one day by flipping the shares.
SIDU stock price though did not hold for long. Like always seems to be the case after any Sidus Space stock gain, the stock soon dropped. It now trades 65% lower than December highs.