Key Stats for Figure Technology Solutions Stock
- Price change for Figure Technology Solutions stock: -6%
- $FIGR Stock Price as of Jul. 13: $30
- 52-Week High: $78
- $FIGR Stock Price Target: $53
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What Happened?
Figure Technology Solutions (FIGR) stock is in focus after the company announced pricing on a $600 million private offering of senior notes on July 9.
The notes carry an 8.5% interest rate and mature in 2031. They’re being sold at full principal amount, with the deal expected to close on July 14.
After accounting for discounts, commissions, and other offering costs, Figure expects to net about $587.5 million from the sale.
The company plans to use most of that money to help pay for its acquisition of Kiavi, an AI-powered lending platform built for residential real estate investors. Whatever is left over will go toward general corporate purposes and fees tied to issuing the notes.
One detail worth noting for Figure Technology Solutions stock investors: this debt offering doesn’t depend on the Kiavi deal actually closing.
The two transactions are proceeding independently, even though the funds raised are earmarked for the acquisition.
The notes are guaranteed jointly by certain wholly owned domestic subsidiaries of Figure Technology Solutions. Because this is a private offering, the notes haven’t been registered under the Securities Act. They were sold only to qualified institutional buyers and non-US persons under standard exemptions for such deals.
This financing lines up with what Figure previously laid out for the Kiavi acquisition.
The company’s total cash consideration for its portion of the deal is $538 million, with Sixth Street Partners buying Kiavi’s loan assets separately.
Figure is acquiring Kiavi’s technology, data, intellectual property, employees, and existing customer relationships.
Management has said it intends to remain conservatively capitalized after the transaction closes, with pro forma corporate leverage below 2x.
What the Market Is Telling Us About Figure Technology Solutions Stock
Figure Technology Solutions stock investors are watching how the company funds its expansion into new loan categories.
Kiavi brings $7 billion in annual volume across residential transition loans and debt service coverage ratio loans, two products in the fast-growing investor mortgage space.
Management has said the deal is expected to be accretive to EBITDA immediately after closing, with earnings-per-share benefits becoming more evident in 2027.
The decision to raise debt rather than issue stock is notable. Figure has said it did not consider using its own shares as consideration for the Kiavi deal, given its current stock valuation.
That suggests management believes debt financing, even at an 8.5% rate, is currently the more attractive option for funding growth compared to issuing new equity.
For Figure Technology Solutions stock to benefit from this deal over time, the company will need to successfully integrate Kiavi’s technology and customer base while managing the new debt load.
The company has said it expects a less-than-4-year unlevered payback period for the acquisition, along with continued progress toward its medium-term target of 60% adjusted EBITDA margin.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
