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Reverse Stock Split - What are the implications?
Posted on 7/4/17 at 8:29 pm
Posted on 7/4/17 at 8:29 pm
I received notice that one of my "investments" will undergo a 1:15 reverse stock split....so for every 15 shares that I own, I will get one. I understand that the $ value of my investment will be the same when all is done. Are there any other implications for this kind of thing?
The way I see it is that the company is acknowledging that their stock price has gone to shite and they are not expecting it to come back....
The way I see it is that the company is acknowledging that their stock price has gone to shite and they are not expecting it to come back....
4
Posted on 7/4/17 at 8:38 pm to Spankum
It's basically a last ditch effort to keep from being delisted.
Posted on 7/4/17 at 11:17 pm to southernelite
It's not always bad. Some reverses happen BECAUSE they want to get listed as they move on up. I had a biotech trading in the pennies, but it had several billion shares outstanding. They did a reverse split, and then listed on the NASDAQ. They've since been bought out.
LINK
Cuts from article back in 2014:
MARLBOROUGH, Mass.--(BUSINESS WIRE)--Advanced Cell Technology, Inc. (“ACT”; OTCBB: ACTC), a leader in the field of regenerative medicine, today announced that it has completed a 1:100 reverse split of its common stock.
“Completing this reverse stock split is an important step in our plan to improve our corporate structure and establish ACT as a highly-regarded, publicly-traded biotechnology company. With continued progress in many of our clinical and pre-clinical programs, the Lincoln Park equity facility in place and Dr. Wotton’s arrival as CEO, this initiative is part of a larger strategy to up-list to a national stock exchange and to raise awareness and visibility with fundamental-based, institutional biotech investors,” said Ted Myles, ACT’s Chief Financial Officer and Chief Operating Officer.
As a result of the reverse stock split, every 100 shares of the Company’s pre-reverse stock split common stock were combined and reclassified into one share of the Company’s common stock. Beginning with the opening of trading on August 28, 2014, the Company’s common stock will trade on the OTC Markets Group on a reverse stock split adjusted basis.
More information is available in ACT's Current Report on Form 8-K, filed today with the SEC.
LINK
Cuts from article back in 2014:
MARLBOROUGH, Mass.--(BUSINESS WIRE)--Advanced Cell Technology, Inc. (“ACT”; OTCBB: ACTC), a leader in the field of regenerative medicine, today announced that it has completed a 1:100 reverse split of its common stock.
“Completing this reverse stock split is an important step in our plan to improve our corporate structure and establish ACT as a highly-regarded, publicly-traded biotechnology company. With continued progress in many of our clinical and pre-clinical programs, the Lincoln Park equity facility in place and Dr. Wotton’s arrival as CEO, this initiative is part of a larger strategy to up-list to a national stock exchange and to raise awareness and visibility with fundamental-based, institutional biotech investors,” said Ted Myles, ACT’s Chief Financial Officer and Chief Operating Officer.
As a result of the reverse stock split, every 100 shares of the Company’s pre-reverse stock split common stock were combined and reclassified into one share of the Company’s common stock. Beginning with the opening of trading on August 28, 2014, the Company’s common stock will trade on the OTC Markets Group on a reverse stock split adjusted basis.
More information is available in ACT's Current Report on Form 8-K, filed today with the SEC.
This post was edited on 7/4/17 at 11:18 pm
Posted on 7/5/17 at 8:41 am to LSUneaux
quote:
Dr. Wotton’s arrival as CEO
Another doctor running a business.
Posted on 7/5/17 at 9:47 am to Spankum
Should be obvious but your basis in the total investment will also remain the same... it's just now divided among fewer shares. Also, holding period remains the same.
Posted on 7/6/17 at 6:56 pm to Spankum
You're not invested in FTR are you? Get out!
Posted on 7/6/17 at 7:57 pm to Spankum
It could have a legitimate purpose for a real company, but note that many penny stocks reverse split their shares when they get into the sub-cent range only to sell more shares after the split. It's a common scheme used by borderline or outright fraudulent companies to raise money at the expense of existing shareholders.
Posted on 7/6/17 at 8:17 pm to mule74
quote:
You're not invested in FTR are you? Get out!
actually, yes...at this point, all I can do is laugh at myself.
Posted on 7/7/17 at 3:28 pm to Spankum
I have three in-laws that work for them and my wife used to as well. That place is a shite show. They are trying to clean it up, but ultimately the burden their debt load is just too much.
I almost bought in at $2.00 because I thought it might find some support. Thank God I didn't.
At this point you might as well stay in and hope for a bounce if someone buys them.
I don't see that dividend holding out much longer though.
I almost bought in at $2.00 because I thought it might find some support. Thank God I didn't.
At this point you might as well stay in and hope for a bounce if someone buys them.
I don't see that dividend holding out much longer though.
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