Not true, IMO. A RS will ruin a DEVELOPING company like UBQU that does not have the fundamental strength to continue its increase in its investors investments. If a RS is done on a felling company, after the RS is accomplished, the stock will continue to spiral downward. The reason why a stock spirals downward after a RS is the company does not have sufficient revenues/profit/fundamentals to support the new price of the stock. Once again, the company results to dilution because the company cannot sustain itself.
Investors will be hurt and there will be a stigma attached not to touch the stock. My suggestion for any CEO is don't do a RS until the company is a sound company. Right now, UBQU is not, repeat, is not a sound company. Any company that have to depend on its investors is not a sound company. REPEAT, A COMPANY THAT HAVE TO DEPEND ON INVESTORS TO PAY SALARIES AND SUSTAIN THE COMPANY IS NOT A SOUND COMPANY AND MUST NOT IN ANY CIRCUMSTANCES DO A REVERSE SPLIT (RS).
THERE WOULD NOT BE A NEED TO DO A RS IF THE COMPANY MADE 30 MIL IN PROFIT. TO REDUCE THE SHARES THEY COULD BUY BACK THEIR SHARES AND RETIRED THEM.
NOTE: THIS KNOWLEDGE AND LEADERSHIP PHILSOPHY WAS ACQUIRED FROM MY CORPORATE FINANCE 101 TRAINING.
IMO