On February 11, 2022, shares of B. Riley Financial Inc. (RILY) were down by 1.63% during regular trading. The stock suffered a further loss of 6.35% in the after-hours session. Multiple reasons can be attributed to the ongoing downtrend of the stock.
During the regular trading session, RILY stock fluctuated between a high of $67.22 and a low of $63.90. The stock closed the session at $64.74 at a below-average volume of 150.13K shares. RILY’s downfall escalated in the after-hours as it plunged down to $60.63.
The financial services and solutions provider, B. Riley Financial Inc. was founded in 1973 and is based in Los Angeles, CA. Currently, its 27.75 million outstanding shares trade at a market capitalization of $1.8 billion.
What happened with RILY?
Two reasons can be attributed to the stock’s recent downtrend. Firstly, the company filed multiple Form SC 13Gs along with SC 13G/A on Friday, February 11, with the SEC. These filings could be one reason for the stock to plunge down on Friday.
Secondly, RILY stock had been on an uptrend for the past few days. While the stock did not gain much but it was able to increase by 5.63% in the past five days. The bullish momentum of the stock probably led to profit booking. Hence, the stock might be going down due to profit booking from the recent gains.
So far, it seems 2022 has not been a good year for the stock. RILY stock has lost a value of 27.14% year to date. Comparatively, the stock was able to increase by 16.21% last year.
Acquisition of FocalPoint Securities, LLC
On January 18, the company announced its agreement for acquiring FocalPoint Securities, LLC for $175 million in total consideration. FocalPoint Securities, LLC is a Los Angeles-based leading investment bank with specialization in mergers and acquisitions (M&A), private capital advisory, financial restructuring, and special situation transactions. This transaction will not only create revenue synergies for both parties but also quadruple RILY’s pro forma M&A advisory business. Moreover, this transaction will also result in the enhancement of the company’s debt capital markets and financial restructuring capabilities.
RILY’s Q3 2021 Highlights
In the third quarter of 2021, RILY had a net income of $48.6 million and total revenues of $381.5 million. This shows a respective increase of 3% and 69% year over year.
Additionally, the company’s adjusted EBITDA increased by 21% year over year to $114.1 million in the third quarter of 2021.
