"A stock that splits will almost always end up heading for the same PPS it was at before the split in the long term. That is why people like a forward split."
way too broad a statement...splits are no different than anything else...if they are done for a good reason, then you will likely have neutral to positive results...if done for a bad reason, then you will have negative results...
as for a r/s, if the company does one because they have fallen on hard times due to a lawsuit or loss of a big customer, they may want to do one in order to comply with their exchanges rules so as not to be removed...if it appears the company is suffering only a temporary set back, the stock should not fall...it can even rise...in this scenario, the company doesnt necessarily want to do the r/s but it may be the best course of action under the circumstances...
a bad r/s is a company with a history of dilution that is obviously doing it in order to bring down the o/s to a more reasonable sounding amount...so they can continue with their dilutive ways...that stock will fall...
f/s are usually done to bring the pps down to where the vast majority of investors are willing to buy it...if a stock hits $150.00 per share, the average investor doesnt invest in it or trade it...so they do a forward split to bring the pps down...essentially the company is doing so well, they did a f/s...that stock will not drop and will likely rise after the split...
its late and i really cant think of any other reason to do a f/s...any other reason is probably not a good one...
"So KBLB split 10:1 at .30 and became a .03 stock. The market would expect it to head back to .30 and it did. "
the stock did essentially nothing for over a year after the split...but it eventually did go up with news...as it would have with or without the f/s...
