I agree most stocks who reverse split suffer further decline in share price post-reverse, however I believe that is because most of them are utilizing the reverse split as a last resort as part of a failed business plan. Very much like individuals who file for bankrupcy, in that if done correctly and strategically it can actually be part of a financial plan.
Reverse splits themselves are not by nature bad things. They are merely methods of adjusting share capital structure the same as a forward split. It is the fact that most CEO's and board members of publicly traded companies have absolutely no experience in facilitating growth and a positve financial plan through the adjustment of share structure. They usually wait until it is too late for them to do anything else. Hence, in this case there is unlikely to be any change.
Does that make a bit of sense?
Robert
There are no good stocks, only good trades.
