Exelixis: Capital Raise, Poor Quarter Deters Investors

Shares of Exelixis (NASDAQ:EXEL) are down 10% already in pre-market trading after the company announced a 20 million share public offering and $225 million principal amount of convertible senior subordinated notes due 2019. The offering, which has yet to be priced, may dilute market capitalization by as much as 15% depending on pricing. The news comes after a rough week for EXEL, which traded down 18% over its course, mostly on poor earnings results. The company increased its losses in Q2 and lost significant sources of revenue with the termination or transfer of four development programs. Exelixis recently filed an NDA for its Thyroid Cancer treatment cabozantinib with Fast-Track status and expects FDA action by or before November 29. Expect losses to even out this morning as investors have taken nearly 35% in the last week and may be sick of negatives.