Street Calls of the Week
EAST AURORA, N.Y. - Astronics Corporation (NASDAQ:ATRO), whose stock has surged over 175% year-to-date according to InvestingPro data, has priced $210 million of 0% convertible senior notes due 2031 in a private offering to qualified institutional buyers, the aerospace technology company announced Wednesday.
The notes, which will not bear regular interest, are set to mature on January 15, 2031, unless earlier converted, redeemed, or repurchased. Astronics also granted initial purchasers an option to buy up to an additional $15 million in notes. The offering is expected to close on September 16, 2025. The company maintains a healthy balance sheet with a current ratio of 3.04, indicating strong liquidity to meet short-term obligations.
The initial conversion rate is 18.2243 shares of common stock per $1,000 principal amount, equivalent to a conversion price of approximately $54.87 per share, representing a 25% premium over the reference price of $43.90.
Astronics plans to use approximately $177 million from the offering, along with $108.8 million in borrowings under its credit facility, to repurchase about $132 million of its outstanding 5.500% Convertible Senior Notes due 2030.
Additionally, the company will allocate approximately $25.1 million to enter into capped call transactions with certain financial institutions. These transactions are designed to reduce potential dilution to common stock upon conversion of the notes up to a cap price of approximately $83.41 per share, representing a 90% premium above the reference price.
The notes were offered only to qualified institutional buyers pursuant to Rule 144A under the Securities Act. Neither the notes nor any shares issuable upon conversion have been registered under the Securities Act.
Astronics Corporation serves aerospace, defense, and other mission-critical industries with power, connectivity, lighting, structures, interiors, and test technologies. While the company’s stock has shown remarkable momentum with a 12.39% gain in the past week, InvestingPro analysis indicates the stock may be overbought at current levels. Discover 15+ additional exclusive insights and detailed financial metrics for ATRO with an InvestingPro subscription.
This article is based on a press release statement from Astronics Corporation.
In other recent news, Astronics Corporation reported its second-quarter 2025 earnings, surpassing expectations with an earnings per share (EPS) of $0.38, exceeding the forecasted $0.29 by 31.03%. The company’s revenue reached $204.67 million, slightly above the anticipated $203.94 million. In addition to its earnings report, Astronics announced plans to offer $210 million in convertible senior notes due 2031. The proceeds from this offering are intended to partially refinance its outstanding 5.500% Convertible Senior Notes due 2030. Furthermore, the company aims to purchase capped call transactions to mitigate potential share dilution. These recent developments highlight Astronics’ strategic financial maneuvers in the market.
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