Earlier this morning Airtasker stock requested a trading halt be granted by the ASX. So let’s have a look at why Airtasker (ART ASX) stock is stuck in a trading halt.

The trading halt relates to a material announcement regarding a proposed equity raising and associated acquisition. The company expects to release further details of the trading halt and acquisition to the market as soon as the institutional placement is completed.

This leaves little room for existing shareholders to participate in the equity raising diluting existing shareholding positions in the market. This proposed equity raising comes a little after the listing in March 2021. It begs the question what exactly are they raising for?

Potentially Airtasker is looking to go global and look to acquire abroad

Potentially Airtasker is looking to go global and look to acquire abroad. There are many potential suitors but we think they may be interested in looking to acquire a company similar to Zaarly. Zaarly is a place to hire home service providers who are proud to be held accountable for their work.

This would greatly expand the footprint of Airtasker however likely come at a considerable cost of cash burn, marketing efforts etc.

Prophets Take on Airtasker Stock

At a share price of $1.08 and a market cap of over $450million. We are not particularly bullish on Airtasker at the current prices.

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Airtasker Stock Price Chart
Airtasker’s Stock Chart

Airtasker stock currently does not excite Prophet and we will be staying clear of any investment in this stock. Prophet Invest slapped a bearish rating on Airtasker stock back when it first IPO’d and we maintain this underperform rating. Here

We will find out further details of the proposed acquisition and equity raising when the shares are resumed for trading on the 25th May.

Please Remember all Articles Published on Prophet Invest are Opinion only

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