Svmuu reported that "New Stock God" Serenity posted on X platform, reminding investors to pay attention to financing structures and the dynamics of outstanding shares, as these are crucial for investment returns, and provided examples:
IREN: The financing method approaches infinite dilution, with each rebound met by selling pressure—essentially a "bad stock."
NBIS: Up 153% year-to-date, thanks to an optimized financing structure (such as direct offerings, convertible bond combinations, etc.).
CRWV: High debt interest; the company uses usurious loans for GPU financing, which erodes free cash flow over the long term.
Serenity pointed out that if a company has strong fundamentals, one could consider going long after the original shareholding has been diluted to near zero. However, for equity value appreciation, one should stay away from companies with "toxic" financing structures or crushing debt. The risk is especially high for small-cap companies, such as $SLNH adding a $500 million ATM while its market cap is only $250 million; $BKKT continuously diluting stock for executive compensation. Essentially, these companies are transferring investor funds to the enterprise, masked by media hype or influencer promotion.
Serenity emphasized that investors must carefully analyze equity structure, dilution risk, and hidden costs when screening targets, to avoid focusing solely on profits while seeing their actual equity shrink.