An at-the-market (ATM) offering is a type of equity distribution program that allows a publicly traded company to sell newly issued shares directly into the open market through a designated broker-dealer agent, gradually and at prevailing market prices. Unlike a traditional follow-on offering — which involves a fixed price and a single large block of shares — an ATM program sells shares incrementally, often over weeks or months, with each sale occurring at whatever the stock's current trading price happens to be.
DilutionWatch monitors ATM programs across 7,300+ stocks because they represent one of the most common and least-publicized sources of share dilution in the small and mid-cap universe. Many retail investors are unaware an ATM program is active until they notice their share count creeping upward on quarterly reports.
The mechanics of an ATM program involve three key steps:
A traditional follow-on offering announces a specific price and share count in advance, causing an immediate stock drop (typically 10–25%) on announcement. An ATM program avoids this "offering discount" by selling at market price continuously, often making it much harder for retail investors to spot.
| Feature | ATM Program | Traditional Follow-On |
|---|---|---|
| Pricing | Prevailing market price per sale | Fixed discount to market (5–10%) |
| Timing | Continuous / over months | Single event, 1–3 days |
| Stock price impact | Gradual, often hidden in volume | Immediate 10–25% drop on announcement |
| Commission | 1–3% to the agent per sale | 5–7% underwriting discount |
| SEC disclosure | Quarterly via 424B3 | Immediate 8-K + S-1 or 424B5 |
| Capital raised | Variable, as needed | Fixed amount, fully committed |
| Investor visibility | Low — retail investors often miss it | High — major news event |
The primary SEC filing types to watch for ATM activity:
S-3 filings and look for "equity distribution agreement" or "sales agreement" language in the prospectus.An ATM program authorizes a maximum dollar amount (e.g., $50 million). Companies disclose how much capacity remains unused. A company with $3M remaining on a $50M ATM has used 94% — it's nearly tapped out and may need to refresh the shelf or raise capital another way. DilutionWatch tracks ATM utilization rates in real time.
Every share sold under an ATM program is a newly issued share that did not previously exist. This increases the total share count (the "float"), which means existing shareholders now own a smaller percentage of the company. The dilution math is straightforward: if a company has 10 million shares outstanding and sells 1 million new shares under an ATM, each existing share now represents 9.1% less ownership than before.
The economic impact depends heavily on the use of proceeds. If the company is burning $5M per quarter and uses ATM proceeds to extend its runway by 12 months before a major catalyst, the temporary dilution may be worth it to existing investors. If the company is simply burning cash with no clear path to profitability, continuous ATM dilution is value-destructive.
ATM programs are most impactful — and most dangerous for investors — in small and micro-cap stocks. A $500M market cap company selling $10M under an ATM represents only 2% dilution. The same $10M ATM on a $50M market cap stock represents 20% dilution and can permanently suppress the stock price. This is why DilutionWatch's DilutionScore algorithm weights ATM utilization rate more heavily for companies with smaller floats.
Large-cap companies also use ATM programs (REITs and utilities use them extensively to raise equity capital continuously), but the dilution impact per share is minimal given their scale. The risk profile is fundamentally different.
DilutionWatch's automated SEC EDGAR ingestion pipeline monitors all 424B3 filings in real time. When an ATM-related prospectus supplement is detected, our system extracts the shares sold, proceeds, agent commission, and remaining authorized capacity, then updates the company's DilutionScore and sends alerts to users who are tracking that ticker. The Shelf & ATM Monitor provides a real-time view of all active ATM programs across the DilutionWatch coverage universe.
DilutionWatch monitors all 424B3 filings across 7,300+ stocks. See every active ATM program, utilization rate, and remaining capacity instantly.
Search a Stock on DilutionWatch →An ATM (at-the-market) offering is a program that lets a public company sell newly issued shares directly into the stock market over time, at the prevailing market price. Unlike a traditional offering with a fixed price and single announcement, ATM programs run continuously and are disclosed quarterly via SEC Form 424B3.
It depends on the use of proceeds and the company's financial position. ATM dilution is less disruptive than a traditional offering (no announcement-day price drop), but persistent ATM use by a cash-burning company with no clear catalyst is generally negative for shareholders. The key metric is capital efficiency: how much runway does each dollar of dilution buy?
Search SEC EDGAR for the company's Form S-3 filings and look for an "equity distribution agreement." Then search for recent Form 424B3 filings — each one shows actual sales activity under the ATM. DilutionWatch aggregates this data automatically for all covered tickers.
ATM program sizes range from a few million dollars for micro-caps to over $1 billion for large REITs and utilities. For small-cap biotech and development-stage companies, typical ATM programs are $15M–$75M. The authorized amount is the ceiling, not a commitment — companies can choose to sell nothing or sell the full amount over the program's life.
"ATM securities" refers to equity securities sold through an at-the-market offering program. The term appears in prospectus supplements (Form 424B3) and S-3 registration statements. It simply means shares sold at market prices via a designated agent rather than at a fixed offering price.