JIADE Closes $3 Million Direct Offering, Reinforcing Dilution Concerns

What happened

JIADE Ltd has closed a $3 million registered direct offering, as announced by Univest Securities on February 19, 2026. This follows a pattern of equity financing highlighted in the DeepValue report, where JDZG has relied on similar offerings to fund expansion amid persistent negative operating cash flow. The report notes that prior offerings in 2025 were priced at $0.58 per share, setting a low anchor for future dilution and increasing per-share value erosion risks. While the exact terms of this new offering are not disclosed in the news release, it signals continued dependence on external capital rather than internal cash generation. This event aligns with the report's bearish view that JDZG remains trapped in a cycle of dilution-funded growth, threatening investor returns.

Implication

Investors should interpret this $3 million offering as a confirmation of the DeepValue report's warnings about serial equity issuance at potentially low prices, given JDZG's history of negative operating cash flow and offerings anchored at $0.58. Without immediate details on pricing, the lack of transparency raises concerns that this could perpetuate dilution without addressing fundamental profitability issues. If priced near prior lows, it could accelerate share value erosion and trigger the report's exit criteria based on sub-$1 equity raises. Monitoring upcoming SEC filings for offering terms and any improvements in operating cash flow over the next 6-12 months is critical to assess if the acquisition strategy is working. Until JDZG demonstrates positive operating cash flow and reduces reliance on discounted equity, the stock remains vulnerable to further downside as the dilution cycle persists.

Thesis delta

This news does not shift the core bearish thesis; instead, it validates concerns about JDZG's ongoing reliance on equity financing to sustain operations amid negative cash flow. If SEC filings reveal this offering was priced at or below $0.58 per share, it would reinforce dilution risks and potentially lower the attractive entry point below $2.25. Investors should maintain a cautious stance, awaiting further disclosures to confirm whether this capital raise is tied to measurable acquisition benefits or merely extends the funding-dependent model.