Bebida Beverage Company (BBDA)

[Whiplash_Investor]

In principle an RS (or a FS) doesn't change market cap or value of your holdings. If you have $1000 invested pre RS, the next day you have less shares, but starting at a higher price, so you still have $1000 invested. The reason RS' are frowned upon is so many Pinks without businesses are just dilution machines, so people sell the day of an RS because they know the PPS, no matter where it starts will go down and 95% of the time that's true. But if it's a growing business, it will return to value in a few days or weeks.

An example of an RS here:

Say you have 100,000 shares that close at $.01 for $1000 in your account. The company does a 1:10 RS (you get 1 share for every 10 you have, but each share is also worth 10X more).

The next morning you would have 10,000 shares, but the opening price would be $.10, not $.01. You still have $1,000.