Rosetta Stone Case study A Recent IPO of Rosetta stone incorporation, which went public on April 16 2009, the day of the offering, Rosetta stone shares began trading on the NYSE at $23 and closed at $25.12,where the first-day jump was more than 39%. Over the next several months, the stock traded for almost 31 per share. Then on August 102009, Rosetta stone announced that it had filed another registration statement with the security Exchange Commission for a secondary offering.Most of the stock to be sold in the secondary offering would come from two shareholders who owned large stakes before the IPO, not from new stock issued by the company. Over the next week,Rosetta Stone’s price fell to $20 per share, a 35% drop in one week. On August 17 2009, the firm announced that the secondary offering was cancelled. Discuss the financial market’s reaction to the secondary offering of a company (why there was a drop in the price) and whether dilution is a reason for the decline.Rosetta Stone Case study

Rosetta Stone Case study
A Recent IPO of Rosetta stone incorporation, which went public on April 16 2009, the day of the offering, Rosetta stone shares began trading on the NYSE at $23 and closed at $25.12,where the first-day jump was more than 39%.
Over the next several months, the stock traded for almost 31 per share. Then on August 102009, Rosetta stone announced that it had filed another registration statement with the security Exchange Commission for a secondary offering.Most of the stock to be sold in the secondary offering would come from two shareholders who owned large stakes before the IPO, not from new stock issued by the company.
Over the next week,Rosetta Stone’s price fell to $20 per share, a 35% drop in one week. On August 17 2009, the firm announced that the secondary offering was cancelled.
Discuss the financial market’s reaction to the secondary offering of a company (why there was a drop in the price) and whether dilution is a reason for the decline.
Secondary Offering is the sale of publicly traded shares that an investor owns to the general public on the secondary market. These securities are shares that the corporation has already sold through an IPO (IPO). In order to raise money, private businesses may decide to sell stock to investors through an IPO. An IPO, as the name suggests, is the initial public offering of shares by a company (Kagan, 2022). Investors are offered these brand-new securities on the open market.The corporation may use the money to cover operating costs, fund acquisitions, or for other uses. Investors can launch secondary offers to the public on the secondary market or the stock market after the IPO is finished (Reboredo, 2018). As was already noted, investors hold the securities offered in a secondary offering and sell them to one or more other investors via a stock exchange. As a result, the seller rather than the business whose shares are traded receives the money from a secondary offering. Cont…

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