A 1:2 reverse split means "1 new share for every 2 current shares." So if you owned 2 shares of a $3/share stock, you would then have 1 share of a $6/share stock after the split.
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richard thomas said: ...
On the Citigroup Reverse Split news announcement this morning around 7:30 a.m., the stock price initially moved lower, but only to around $3.00 which was near support at yesterday's closing price.
Reverse Split A reduction in the number of shares outstanding that results in a increase of the stocks value
Risk The chance that the return on an investment will be less than expected
Round Lot The normal unit of trading for a security ...
Reverse Splits
Reverse stock splits are less common and have a somewhat negative investment strategy attached to them.
Reverse split: Combine multiple stock shares into one share such that the stockholder's equity (both in total and for the individual stockholder) remains unchanged, but each stockholder holds fewer shares worth more each.
reverse split: The procedure by which a company reduces the number of shares outstanding. The total number of shares will have the same market value immediately after the split as before it, but each share will be worth more.
Stock Reverse Split for Options
Options are also divided the same way. If you own 10 option contracts before a 10 for 1 split you now own 1 option contract at a much higher price.
In a reverse split, the company reduces the number of outstanding shares and the per share price rises accordingly.
One byproduct of a reverse split is that a shareholder may be paid out in cash upon the split if they do not hold enough shares to be made whole if the split occurs.
This process is generally executed for the opposite purpose of reducing the number of common shares outstanding and thereby increasing the stock price to reflect the reverse split ratio.
See individual investor reverse split
See split right
A privilege allowing existing shareholders in a company to buy shares of a new issue of common stock before it is offered to the public. road show ...
The stock has a 5 for one reverse split and he celebrates the fact that he sold his remaining little stake at a 75% loss instead of the 95% loss that would happen just a week later.
When a company has had a dramatic decline, it may issue a reverse split to stay in business. For example, a stock that has fallen to 50 cents may issue a 1 for 10 reverse split.
A company may also perform a reverse split to eliminate small shareholders. For example, a penny stock worth $1 may have a 1-for-10 split and be worth $10. After the split, 10 old shares would be needed to equal 1 new share.
After the reverse split, the firm's stock price is, in this example, three times the pre-reverse split price. A firm generally institutes a reverse split to boost its stock's market price. Some think this supposedly attracts investors.
A company will generally use a reverse split to boost its stock price, which is sometimes instituted by companies to avoid being delisted from an exchange. Reverse splits are usually not looked at positively by investors. See also Stock split.
I sold it again at about $40 (course that was after the 50-1 reverse split). I don't expect anyone to get every call right. If I did, my portfolio would have one position.
You also have to watch out for reverse splits and issuance of new stock that can dilute the
value of each share. Excessive press releases from so called "third parties" touting the stock will also
need to be watched out for.
Salamon Group, Inc. (SLMU) Cancels Plans on Reverse Splitting Share Structure
Publish Date: Mar 12, 2012 09:00 AM
Radmax Engine Parts Arrive at Williams and White Facilities on Monday, March 5th 2012
Publish Date: Mar 12, 2012 09:00 AM ...
D
Fifth letter of a NASDAQ stock symbol specifying that it is a new issue, such as the result of a reverse split.
D/A
See: Documents Against Acceptance ...
Stock split calendar for U.S. companies
Stock split and reverse split examples for shareholders
Swiss stock split calendar for European companies and worldwide companies incl. U.S. companies (in German) ...
A reverse stock split reduces the number of shares and increases the share price proportionately. For example, if you own 10,000 shares of a company and it declares a one for ten reverse split, you will own a total of 1,000 shares after the split.
"Oracle's Earnings Leave Ellison Undaunted"
"GE's Immelt says Honeywell Merger Chance Now Zero"
"Parts.com, Inc. Directors Approve One-for-Ten Reverse Split" ...
Eg, if XYZ stock is trading at 100 & does a 2/1 forward split, each shareholder will have twice as many shares with the stock now priced at 50. Reverse split: A decrease in the number of shares of a corporation without any change in the ...
For example, a 2/1 split would double the number of outstanding shares and halve the stock price. A reverse split generally occurs when things are going poorly.
The shareholders equity does not change. A reverse split is where the total number of shares is decreased and the stock price increases proportionally. As in a split the total stock holders equity remains the same.
For example, a 1-for-3 split would result in stockholders owning 1 share for every 3 shares owned before the split. A firm generally institutes a reverse split to boost its stock's market price and attract investors.
valued at $20 each, it could declare a two-for-one stock split, whereby it would then have 200 million shares valued at $10 each. If you had 100 shares in your portfolio, after the split, you would have 200. Companies can also do reverse splits, ...
Each holder of 100 shares before the split would have 300 shares worth less, although the proportionate equity in the company would stay the same. A reverse split would reduce the number of shares outstanding and each share would be worth more.
Conference calls may also deal with other matters, including mergers, acquisitions, stock splits or reverse splits, or relevant political or economic developments.
The stock dropped to about 11 cents and did a 30:1 reverse split. The President resigned, the merger with the financial institution was called off. The stock price dropped to 7 cents. The call letters changed to WSOX. The 238 shares I paid $9500.
(Most exchanges have certain share price requirements that companies must meet in order to stay listed.) Troubled firms stuck in this position will sometimes employ a reverse split.
reverse split A stock split which reduces the number of outstanding shares and increases the... Reverse Take-Over Abbreviated as RTO, refers to when a firm buys out a larger firm, but could...
 See also: Split, Stock, Trading, Market, Share
  
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