InterCloud Systems Inc. (ICLD)

[Longer Than Most]

No you are correct. But in almost ALL cases (aside from ICLD imo) an RS is bad. Many people sell automatically when an RS occurs. It almost always gaps down the morning of it taking affect. I can show you chart after chart where the stock plummeted the day of RS.

An RS is usually negative because of one of these reasons:
1. The company no longer meets the minimum price requirement for its exchange (occurs after consistent downtrend). I've seen companies get oversold and bounce very well in this situation.
2. The company wants to continue to dilute but lower stock prices deter investors so they need to artificially raise the price. They also do this when a stock is nearing .0001 since you can't dilute when there isn't a bid. (Occurs after long term downtrend). There are almost always opportunities with diluted stocks but they suck and people get suckered big time.

An RS is usually positive when the company is trying to UPLIST or attract more investors, or both. That being said, because the MAJORITY of reverse splits are to conserve a stock price, people hit auto-sell because of the fear and stigma that comes with it. This RS appears to have the goal of GROWING the investor base, and eventually the price.