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The dreaded reverse stock split decision for shareholders...



June 19, 2013 – Comments (3)

Hopefully  none  of  my  fellow  fools have  ever  been  in  the situation  of   holding  onto an investment  in  which  to  avoid  getting  kicked off  certain  exchanges  and because of  a  lack of  otherwise  performance  that should have  forced  managers  to  a  walk  of  shame  out  of  their organizations.

But  for  the  fools that  have  had  the  decision  to  be  at  least able  to  proxy  shares  to vote yay or  nay  as  to   a  company  doing a  reverse  stock  split.

Unfortunately  personally  I've  had  to vote  on  not  one  but  two  company's   and   I  voted  for  the  company's  to  not  be  allowed  to perform a  reverse  stock split.

My  reason  being,  is  that  IMHO  doing  them  just makes  its  easier  for  such  share prices to  decline.

2)  It  bails  out  bad (incompetent)  management,  managers who  are more concerned  about their  own well being  and  status  than  shareholders.

I  hope  ya  never  have  to be  subjected  to a  reverse  stock  split...

For  my fellow  less informed  fools  a  reverse  stock split  is  like  where  you  have  less  shares  after its  done...

IE  a  10  for  1   reverse  stock split  would  say  reduce  someone   who  had   100  shares  into now having  only  10  shares.

3 Comments – Post Your Own

#1) On June 19, 2013 at 8:45 PM, HarryCaraysGhost (81.07) wrote:

So what was the stock?

I've had two stocks do a reverse on me, Lode and Emkr. I knew I was speculating going in and put my asset allocation skills to use.

But still, whether it's a hundred beans or 10 grand, that lipstick on a pig is a salty mistress indeed.

Have to do the disclaimer-

A split-forward or reverse or has no meaning on the price of any given security.

Any movement in share price is based on Mr.Markets schizophrenic gryrations.

Please follow the fundementals of said company before investing.

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#2) On June 20, 2013 at 1:13 AM, awallejr (34.17) wrote:

Well some reverse splits can be done for positive reasons like Sandstorm Gold and Stty.  Look at Citibank too.  Your ownership interest doesn't change, but generally a reverse split means your stock tanked and it needs to reverse to stay listed like Citibank heheh.

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#3) On June 20, 2013 at 8:36 AM, ElCid16 (94.39) wrote:

JMBA recently reversed.  Over the subsequent 4 days, a mountain of volume and a $2/share jump in the share price occurred.  My guess is that some institutional investor couldn't purchase a sub-$5 stock but wanted in on JMBA.  After the split, they were able to load up.

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