By Drew Singer

January 29, 2021

Some of the Reddit day-trading crowd’s favorite companies are capitalizing on their newfound popularity by selling shares to raise fresh capital.

American Airlines Group Inc. on Friday announced plans to sell up to $1.1 billion of shares after a 17% climb over the past two sessions amid Reddit chatter about squeezing shorts.What’s moving marketsStart your day with the 5 Things newsletter.EmailSign UpBy submitting my information, I agree to the Privacy Policy and Terms of Service and to receive offers and promotions from Bloomberg.

Also on Friday, pot stock Sundial Growers Inc. erased a premarket surge after announcing a $100 million stock sale at a discount to Thursday’s closing price. Small-cap pharma stock JanOne Inc. also raised equity Friday after shares more than doubled over the past two days in a surge that traders linked to retail speculation. Shares in all three stocks fell on Friday after the deals were announced.

Those share sales follow a $305 million raise by AMC Entertainment Holdings Inc. earlier this week. Traders are expecting even more deals as firms like these seek to repair pandemic-battered balance sheets while demand for shares is high.

Shares double and triple in days before companies raise equity

The stocks are among those that surged of late as investors continue a relentless buying spree in firms touted on Reddit. More Reddit picks such as GameStop Corp.Express Inc.Bed Bath & Beyond Inc., and Naked Brands Group Ltd may also be on watch for stock offerings after shares further extended runups in on Friday.

AMC is reportedly weighing a second offering, while at least one analyst has called for GameStop to bring a stock sale for “as much as the market can absorb.”

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