DoorDash dips after upsized $2.5 bln convertible bond sale

DoorDash's DASH.O shares down 0.3% premarket at $204.20 after meal delivery platform clinches capital raise

San Francisco-based DoorDash late Tues announced pricing offering of $2.5 bln 0% 5-yr convertible bonds

Offering size boosted from $2 bln; initial conversion price of $291.87 represents 42.5% premium to stock's last sale

In addition, co entered hedge transactions to offset share dilution with strike price of $512.225, 150% above stock's last close

Co intends to use portion of net offering proceeds to fund cost of hedge transactions, rest for general purposes, including potential acquisitions and share repurchases

Earlier this month, DoorDash said it will buy British rival Deliveroo ROO.L in deal valued at $3.9 bln, and would buy software firm SevenRooms for ~$1.2 bln

DASH shares on Tues finished down 0.6% at $204.89, giving co roughly $87 bln market cap, per LSEG data

YTD, shares up 22% YTD

29 of 41 analysts covering DASH rate stock "strong buy" or "buy", 12 rate "hold"; median PT is $223.50, latest LSEG data shows