Lionsgate
On Tuesday, the entertainment company announced that investment funds affiliated with MHR Fund Management, its largest shareholder, are selling 10 million shares.
MHR owns 35% of the company.
Lions Gate also updated its 2015-2017 profit guidance in a filing with the SEC to within the lower range of the $1.2 billion to $1.3 billion it previously guided.
In a note Wednesday, Stifel analysts wrote that MHR's sale is negative for the company because the fund was not able to sell its stake to a "strategic buyer."
Stifel also weighed in on why Lions Gate is expecting lower profits:
The company noted that it is tracking within the lower range of its previously guided range of $1.2bn to $1.3bn. We suspect lower overall profitability for the "Insurgent" franchise as the likely driver towards the lower end of previous guidance as well as modestly lower expectations for the final installment of the "Hunger Games" franchise. We have adjusted our estimates downwards accordingly.
The stock fell by nearly 7% to around $31.36 per share in trading on Wednesday.
Here's a chart showing the dive:
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