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Wheeler Real Estate Investment Trust, Inc. (NASDAQ:WHLR), a small-cap REIT with a market capitalization of $0.62 million and annual revenue of $104.31 million, has announced an adjustment to the conversion price of its 7.00% Subordinated Convertible Notes due 2031, according to a recent 8-K filing with the Securities and Exchange Commission. The adjustment follows the April 7, 2025 redemptions of the company's Series D Cumulative Convertible Preferred Stock. According to InvestingPro analysis, the company's stock has experienced significant volatility recently, with several key metrics suggesting potential undervaluation.
Previously set at approximately $4.56 per share of common stock, the conversion price for the notes has been reduced to approximately $1.97 per share, while the current stock price stands at $2.64. This change represents a significant discount and increases the number of shares obtainable per $25.00 of principal amount from approximately 5.48 to approximately 12.69 shares. InvestingPro data reveals the company maintains a healthy current ratio of 2.18, indicating strong ability to meet short-term obligations.
The adjustment was triggered by the April redemptions, where the lowest conversion price of Series D Preferred Stock into common stock was around $3.58. The conversion price adjustment is a direct result of these transactions, as outlined by the terms of the indenture governing the notes.
On Monday, Wheeler REIT processed 13 redemption requests from holders of its Series D Preferred Stock, totaling 38,990 shares at a redemption price of approximately $40.75 per share. Settlement for these redemptions was made through the issuance of 443,715 shares of common stock.
To date, Wheeler REIT has processed 334 redemption requests, which collectively redeemed 1,616,833 shares of Series D Preferred Stock. In return, the company has issued approximately 811,800 shares of its common stock. As of today, Wheeler REIT has 1,033,215 shares of common stock and 1,936,274 shares of Series D Preferred Stock outstanding.
Looking ahead, the deadline for the next monthly round of Series D Preferred Stock redemptions is set for April 25, 2025, with the subsequent Holder Redemption Date scheduled for May 5, 2025. Holders interested in redemption can find necessary forms and a list of FAQs on the company's website, although this information is not considered part of the 8-K filing. With the company's substantial EBITDA of $55.06 million and upcoming earnings report expected on May 8, 2025, investors seeking deeper insights can access additional analysis and 13 more exclusive ProTips through InvestingPro.
This latest development provides current and potential investors with new information regarding the company's financial instruments and may influence investment decisions based on the revised conversion terms. Wheeler REIT's actions are part of its ongoing financial management and are disclosed in compliance with SEC regulations.
In other recent news, Wheeler Real Estate Investment Trust, Inc. has made several significant announcements. The company has secured a $10 million loan from KeyBank National Association to support Cedar Realty (NYSE:CDR) Trust's tender offer for its Series B Cumulative Redeemable Preferred Stock. Additionally, Wheeler REIT has announced a one-for-five reverse stock split of its common stock, effective March 26, 2025, which will affect various convertible securities and preferred stocks, including the Series B and Series D Convertible Preferred Stock. The reverse stock split will also adjust the terms of Wheeler's incentive plans. Furthermore, Wheeler REIT has adjusted the conversion price of its 7.00% Subordinated Convertible Notes due 2031 following redemptions of Series D Preferred Stock. Previously set at approximately $3.88 per share, the conversion price has now been lowered to about $0.91 per share. These corporate actions reflect Wheeler REIT's ongoing efforts to manage its capital structure and financial obligations.
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