INBK Common Stock Offering

Does anyone know why INBK issued the common stock in may? I was surprised that the stock didn’t drop more as a result of the stock offering, and I am not clear on why they felt the need to do that in the first place. I have been patient with my shares but the stock offering really gives me pause. Maybe INBK isn’t as good as the numbers seem to indicate.

Best,

bulwnkl

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I asked that question here earlier, and no one seems to know. I am concerned about this issue also. It will hurt their ability to improve returns on equity, and make me concerned that they can’t actually achieve a high roe. They’ve done offerings in the past, and it seems like they make two steps forward then two steps backward. I also wonder why they raised equity now in the low to mid $20’s, and not awhile ago when the stock was over $30. It’s also curious that the analyst estimates have not come down for this year and next, even though there are now roughly 20% more shares outstanding. The company can’t use the cash productively that quickly.

Maybe they were forced to issue equity because of capital requirements?

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Thanks. In the press release, it said that they were going to pay down debt and use the money for general purposes. I don’t think I understand this business as well as I thought I did. I will likely bail next week.

Best,

bulwnkl

Does anyone know why INBK issued the common stock in may?

My take is business is bustling and they need more funds to loan out.
It’s dilutive of course but in the long run it works out for all share holders. BOFI does the same thing on a regular basis, especially when their share price was higher, that was dilution of the good kind at those prices.

Home sales are booming as we have noticed at LGI Homes and others.

JT

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One other thing that bothers me about INBK. If they need cash so badly that they need to issue shares, why would they pay a dividend right now? Also, shouldn’t they be conserving cash to reinvest in explosive growth at this stage of the companies life cycle rather than paying a dividend. It just doesn’t add up to me.

Best,

bulwnkl

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