SK3 Group Inc. (SKTO)

[stockfinder2012]

The markets generally like forward splits. It's the reverse splits that are the kiss of death in most cases.

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A "Forward" stock split is almost always regarded as a net positive event for the investor who holds shares in the respective company, the basic concept is as follows.

A company up until a specified date after the split is announced, will distribute additional shares at no cost to all investors who own or hold stock. The number of new shares received will depend on the "Split Ratio". For instance a 2:1 stock split means the individual investor or institution is entitled to receive 1 additional share for every share currently owned and or purchased in the future up until the designated cutoff date. If an investor owns 100 shares, an additional 100 will be distributed and automatically deposited into their account for a post split total of 200 shares. A 3:1 split will result in a total of 3 shares for every 1 an owner holds prior to distribution, and so on, 4:1 = 4 shares for every 1, 5:1 = 5 shares for every 1 etc.

A forward stock split will increase the number of shares outstanding by the exact number of new shares distributed to shareholders without resulting in dilution. Even though terms like "New" shares or "Additional" shares are frequently used by the "Street" to describe the process, there are no "New" shares either issued or distributed from the "Authorized" batch. Current outstanding shares are simply "Split" in half at the administration level.