RCS Capital's stock: How low can it go?

Shares of RCS Capital Corp. were down again in trading Thursday after the wholesale and retail broker-dealer priced its secondary stock offering at $20.25 per share, well below its hoped-for price. At 1 p.m. New York time, shares of the company were at $20.25, down 10.4%, or $2.36 from Wednesday's close. Over the past month, the company's share price has taken a beating, dropping 37% from $35.87 on May 5. Investors, however, could ultimately benefit from the sharp increase in shares on the market and liquidity in the stock, which are necessary to attract institutional investors like mutual funds. Last week, the company, known by its ticker symbol RCAP, estimated selling 15 million shares at $29.74 each resulting in gross proceeds to the company of $446.1 million. Now, with those shares offered at $20.25, the company expects $384.8 million, or close to 14% less than it originally intended to raise. Meanwhile, controlling stockholders, including RCAP's executive chairman Nicholas Schorsch, are also raising less money than originally proposed. According to a statement from the company, RCAP Holdings, which is the controlling stockholder of RCAP, is offering $101.3 million in shares of common stock, or 31.9% less than the $148.7 million amount announced last week. RCAP also granted its underwriters, a lineup that included Merrill Lynch, Barclays, Citigroup and J.P. Morgan, a 30-day option to purchase an additional $72.9 million of its shares to cover any potential over-allotments. Andrew Backman, head of investor relations for RCAP, said the company couldn't comment because it was in its registration period with the Securities and Exchange Commission. RCAP listed its shares at $20 each a year ago and has been on an acquisition binge ever since, buying retail broker-dealers, a rival nontraded real estate investment trust wholesaler, an liquid alternative fund company and even a due diligence shop. It has financed the acquisitions through the sale of common and preferred shares, and borrowed $700 million as part of its most significant acquisition, the Cetera Financial Group, which consists of four broker-dealers. [More: IGM financial Rockefeller: Rockefeller Capital sports $3.1 billion valuation with new investment]