Cloud computing and software company PagerDuty (PD) -) announced Oct. 9 that it intends to issue new notes to cover the purchase of older ones. The company said it will offer a $350 million principal amount of convertible senior notes due 2028 and intends to use the proceeds to cover corporate expenses.
Following the announcement, shares of PagerDuty tumbled, closing Oct. 10 down nearly 2%. Shares fell as much as 10% after hours before lifting slightly and stabilizing.
Related: Cathie Wood sinks nearly $1 million into popular, surging tech stock
In the midst of this, Cathie Wood's Ark Invest picked up a total of nearly $8 million worth of PagerDuty stock. The bulk of the purchase, in the form of 310,996 shares, came from Ark's flagship Innovation ETF, boosting the fund's total PagerDuty holding to 8.4 million shares, worth $180.5 million and weighted at 2.6% of the fund.
Ark's Next Generation Internet ETF additionally picked up just shy of 60,000 shares of PagerDuty, boosting its holding to around 1.5 million shares, worth $32.1 million and weighted at 2.5% of the fund.
Where other prominent tech giants, such as Tesla (TSLA) -) and Nvida (NVDA) -), are up by more than 100% for the year, shares of PagerDuty have been struggling recently. The company's stock is down around 20% for the year after dipping heavily in April and then again in June.
The average analyst price target for the tech firm is pegged at around $28, with analyst consensus split between hold and buy ratings. Morgan Stanley lowered its PagerDuty price target to $32 from $35 at the end of September.
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Reporting fiscal second-quarter earnings Aug. 31, PagerDuty noted a GAAP operating loss of $26.2 million. The company reported revenue of $107.6 million for the quarter, a 19% increase from the year-ago period.
“PagerDuty delivered durable growth with continued improvement in operational efficiency, exceeding our guidance on both the top and bottom line,” Jennifer Tejada, PagerDuty's Chairperson and CEO said at the time. “PagerDuty advanced our generative AI offerings in the quarter to include AI-generated runbooks, expanding the Operations Cloud to address our customers’ top priorities – to protect and grow revenue, reduce operating costs and mitigate risk.”
Shares of PagerDuty previously closed down at $21.45.
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