Why Is RDW Stock Falling Today?

Redwire disclosed its capital-raising plans via an at-the-market offering, stating that it would use the proceeds for working capital and other general corporate purposes.

• The substantial capital-raising plan comes as the company pushes to fulfill several orders it booked in recent months.
• Redwire’s contract backlog at the end of the first quarter stood at just under $500 million.
• Last week, Redwire secured a contract to grow strawberries and test a soil-enhancement product for Luxembourg-based Astrobiome Space in its greenhouse systems aboard the International Space Station.

Shares of Redwire Corporation (RDW) were in the spotlight on Tuesday after the company disclosed plans to raise up to $500 million through an “at-the-market offering” of its common stock.

At the time of writing, RDW stock was down nearly 8% premarket and the top-trending ticker among equities on Stocktwits.

Use Of Proceeds

Redwire said it would use the proceeds for working capital and other general corporate purposes, including debt repayment or refinancing, acquisitions, investments, and R&D funding, after deducting the agent’s commission.

The substantial capital-raising plan comes as the company pushes to fulfill several orders it booked in recent months. Coincidentally, at the end of the first quarter, Redwire’s backlog stood at just under $500 million.

Last week, Redwire secured a contract to grow strawberries and test a soil-enhancement product for Luxembourg-based Astrobiome Space in its greenhouse systems aboard the International Space Station. In May, Redwire secured at least two contracts for its unmanned aerial systems from the U.S. Army and a NATO member, worth tens of millions of dollars.

What Do Retail Traders Think About RDW?

On Stocktwits, retail sentiment surrounding the stock remained ‘bullish’ over the last 24 hours.

One user on the platform said that for the stock to stabilize, it will need to find a firm horizontal support zone where long-term institutional buyers are willing to absorb both the active ATM selling and the flushing momentum traders.

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Another bullish user commended the ATM offering.

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RDW stock has more than doubled in value so far this year, outperforming the S&P 500.

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