POET Technologies $POET ( ▼ 17.09% ) is getting hit in early trading after the optical communications company announced a $150 million capital raise through a registered direct offering.
The deal involves selling roughly 20.7 million shares, which is why the stock is tumbling. Offerings like this usually trigger instant dilution fear.
What happened
POET is raising $150M by issuing new shares, right after the stock had already ripped more than 30% year to date.
So from the market’s perspective, management is basically doing what companies love to do after a big rally: sell stock into strength.
Why POET is doing it
Management is pitching the raise as a growth acceleration move, saying the new cash pile will help them:
pursue targeted acquisitions
expand capabilities and talent
vertically integrate products using differentiated components
scale operations to chase more revenue opportunities
This is the classic “we’re building the next phase” funding pitch.
The flashback that’s spooking traders
This is not POET’s first time doing this.
Their last offering was in late October, and after that the stock nearly got cut in half within a month as speculative high-volatility names sold off hard.
So traders remember the pattern: rally, offering, pain.
Bottom line: POET might be raising money for growth, but the market is pricing it like dilution risk first, vision later.