Chinese e-commerce giant JD.com said Tuesday it will raise $1.75 billion through a convertible notes offering, which was upsized from a $1.5 billion target announced earlier in the day. JD stock fell on the news.
The company will use the proceeds to buy back some of its shares, expand its overseas business and improve its supply chain network, according JD's news release. The bonds are due in 2029 and can be converted into equity in the China e-commerce company.
The convertible bond offering is the largest of its kind in Asia this year, according to Reuters.
On the stock market today, U.S.-listed JD stock is down more than 3% at 33.49.
JD Stock: Q1 Earnings Boost
The offering comes a week after JD stock jumped following a strong first-quarter earnings report. As reported on May 16, JD sales increased a better-than-forecast 7% in local currency, totaling $36 billion. Earnings of 78 cents per U.S. share, up 19% in local currency, also beat views.
JD stock gained 2% in trading following the report and another 3% in trading the next day.
Including Tuesday's dip, JD shares have gained 19.5% this year but remain down about 1.5% compared to 12 months ago. Last year, U.S.-listed JD shares fell nearly 50% amid concerns about the Chinese economy and slowing sales growth.
JD stock has an IBD Composite Rating of 91 out of 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.
Meanwhile, JD's IBD Relative Strength Rating is 83 out of 99.
