Friday, May 28, 2021 12:32:57 PM
Let’s keep it simple.Let’s say you have 1 million shares you bought at .012. The value of your shares is $12,000.
Let’s say there is a 100 for one split. Now you have 10,000 shares. At the moment the Market opens, your value is still 12,000, but your buy in cost is now 1.20.
If the company has done something to solidify its business and can hold the price of $1.20, the value of your stock will stay the same. The only thing that changes is your earning power.
When you had 1 million shares, and the price goes up $.10 cents, you just made $100,000.
After the split you only have 10,000 shares, so if it goes up $.10 cents, you will only make 1000 dollars.
However, if a company does not have a solid business plan in place when they do a reverse split to uplist, the Stock price will begin to fall. And if it goes back to being a penny stock after up listing, I don’t have to tell you what your bank account is going to
Look like.
So sure, if a company is solid and continuing to grow at a good pace, your stock will hold value after a reverse split.
But if a company says they are doing all these great things but it’s not really executing them, and they go forward with a reverse split to try to up list, the results will be devastating to everybody involved.
Hope this helps with your question,
Best to all,WW
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