Velo3D Inc. (NYSE:VELO) shares are up on Wednesday as the company converted certain of its debt to equity at $16.38 per share.
Debt Reduced by 60%
Arun Jeldi, Velo3D’s CEO, acquired and converted a portion of the company’s debt into equity, seen as a strategic move to strengthen the company’s balance sheet.
Jeldi acquired a $5 million promissory note and converted it into shares at $16.38 per share, reflecting a significant premium.
“My decision to acquire and convert this debt at a significant premium to market reflects my belief in the long-term value of Velo3D,” said Arun Jeldi.
“We have substantially deleveraged our balance sheet and are entering fiscal 2026 focused on scaling our platform and delivering results for shareholders,” Jeldi said.
Separately, an existing noteholder and a director, Ken Thieneman, also converted a $10 million promissory note at $10.50 per share. In total, the company reduced its outstanding debt by 60% to approximately $10 million.
The conversion of debt to equity can alleviate financial burdens and potentially enhance shareholder value moving forward.
Velo3D‘s Defense Contract
Velo3D in February announced an $11.5 million multi-year full-rate production contract with a major U.S. defense contractor.
The company was recently named the first qualified 3D-printing vendor by the U.S. Army Ground Vehicle Systems Center.
This qualification allows the company to produce critical aluminum and Inconel 718 components for ground combat vehicles.
VELO Strong Above 20-Day and 100-Day SMA
Currently, Velo3D is trading 18.6% above its 20-day simple moving average (SMA) and 25.4% above its 100-day SMA, indicating strong short-term momentum.
Over the past 12 months, shares have surged 286.21%, and they are currently positioned closer to their 52-week highs.
The RSI at 51.60 is considered neutral territory.
Meanwhile, MACD is at -0.3130, with the signal line at -0.6895, indicating a bullish signal as the MACD is above the signal line.
The combination of neutral RSI and bullish MACD suggests mixed momentum, indicating that while the stock is not showing strong overbought or oversold conditions, there is potential for upward movement.
- Key Resistance: $15.50
- Key Support: $12.50
VELO Price Action: Velo3D shares were up 17.84% at $14.60 at the time of publication on Wednesday, according to Benzinga Pro data.
Image via Shutterstock
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