At this point it's just one of their goals for the current fiscal year.
The situation today is very different than it was three years ago when they announced the VitaCig spinoff. First, we don't know what piece of their business they're thinking of spinning off. Three years ago, no one knew there would be a stock dividend before they announced it would be VitaCig. Second, neither company had a rational valuation at the time. When the VitaCig dividend was announced on Feb 3, 2014, mCig was trading at $.315/share. VitaCig hadn't been released yet and had zero revenue. mCig had just made $85,000 revenue in its last quarter and had a market cap of over $85 million. We all thought the MJ bubble would go on forever. mCig's pps drop had nothing to do with the dividend. Mcig tanked because the entire sector tanked.
Today, mCig is trading at a very rational $.18/share on earnings of $1.5 million which gives them $.0043 earnings per share and a Price Earnings (PE) ratio of roughly 42x. The average PE of stocks on the Russell2000 index of small cap companies is 82.36x. mCig is undervalued. It's also likely that whatever they spin off will also have a revenue record before it's announced.
If and when a spin-off occurs, it will be value neutral to shareholders. The VitaCig spinoff was value neutral. VTCQ shares were valued at $.0001/share when the shares were awarded. That amount, $.0001/share was subtracted from MCIG's closing price from the day before the ex-dividend date and the effect was negligible on the share price. The same thing will happen once the new stock dividend is priced. Consequently, the value of mCig shares will go down by the amount of value that's transferred to the new company. Where share prices of both companies go after that will depend on how the dividend is perceived by the market and the prospects of each separate company.
