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Wednesday, April 12, 2006 6:29:27 PM
Depends on what kind of company we're talking about. Sometimes it can work, if the company is "real" and is doing the split for a legitimate reason, such as reducing the o/s so they can list on an exchange. But it isn't a sign of "reorganization". With penny stocks, it's often done so they can get the o/s down to a manageable level and then start dumping stock into the market again.
Is it good for a company to do this?
Technically, it's neither good nor bad for the company. It won't affect their business, assuming they have one.
Is this the kiss of death for the company?
It's often the kiss of death for shareholders, especially if the company has a history of doing reverse splits.
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