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Re: scstocks post# 19167

Monday, 07/28/2008 11:33:31 PM

Monday, July 28, 2008 11:33:31 PM

Post# of 57986
Scstocks: regarding COR’s reverse stock split in 1995, you wrote << If a stock has a regular 2 for 1 split, then the price is reflected accurately on the next days chart, opening at half the previous days close, because the shares out are twice as many. The chart before that time remains unchanged, or so I think. >>

That doesn’t appear to be the case on long-term charts. For example, take a look at the Yahoo finance chart on AMGN, which has had five splits for a combined 48:1 ratio. A share purchased for 5.00 in the mid 1980s would now be worth 48 shares at about 60.00 each. Not a bad return, but the point is that a split-adjusted long-term chart displays a value of 0.10 for those early shares. More to the point, there are no step downs in price on the split dates.

A long-term chart for COR should be displayed similarly, if you can find one that goes back far enough. So, five shares of COR purchased for 2.00 dollars each prior to the 1995 reverse split (5:1) would have evolved into one share of COR priced at a little less than 1.00 dollar today. An adjusted long-term chart should display the original purchase as 10.00 dollars (i.e. the price at that time for the combined five shares that are historically behind each of today’s shares).

With best regards, I hope this helps answer that part of your question.

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