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Sunday, March 30, 2014 2:45:23 PM
With a 1:2 reverse split, the share price doubles to $6
With a 1:4 reverse split, the share price quadruples to $12
It has absolutely NOTHING to do with returning money to shareholders. The only time that happens is when someone holds an odd number of shares that isn't divisible into a whole number by split ratio. In that case, the company can choose to compensate for the left over share fraction, or in this case as INO chose to do, simply round the share count up for that investor up to the next whole number.
So, if it does not have anything to do with raising or disrupting cash, why do a reverse split? Well in this particular case, the motive is to make the stock more attractive to institutional holders. The benefit (in theory) is that this will make the stock less subject to manipulation and result in a more stable stock price.
If that's the case, why all the negativity around the issue? Well, simply because there is another reason companies will initiate a reverse split - that being when a company's share price falls below the listing standard to remain on an exchange. In that case the reverse split is seen as the sign of a company in it's death throes. It may or may not be the case that the company goes under. For example, see PEIX which just underwent a 15 for one reverse split last summer. In their case, the reverse split helped them remain on the NASDAQ long enough for corn prices to come down and ethanol market to recover.
Recent INO News
- INO-3107 Awarded the Innovation Passport Designation Under U.K. Government's Innovative Licensing and Access Pathway • PR Newswire (US) • 07/11/2024 12:00:00 PM
- INOVIO Announces Appointment of Steven Egge as Chief Commercial Officer • PR Newswire (US) • 07/02/2024 08:05:00 PM
- INOVIO Reports Inducement Grant Under Inducement Plan • PR Newswire (US) • 07/01/2024 08:00:00 PM
- INOVIO Added to Russell 2000® Index Effective July 1, 2024 • PR Newswire (US) • 07/01/2024 12:00:00 PM
- INOVIO to Participate in Virtual Fireside Chat Hosted by Stephens Inc. • PR Newswire (US) • 06/04/2024 12:00:00 PM
- INOVIO Reports Inducement Grants Under Inducement Plan • PR Newswire (US) • 05/31/2024 08:48:00 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/28/2024 08:01:02 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:51:58 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:51:38 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:51:16 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:51:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:50:34 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:50:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/22/2024 08:49:53 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:13:02 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:12:10 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:11:09 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:10:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:08:13 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:06:36 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:05:26 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:04:16 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:02:59 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 09:00:35 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 08:59:31 PM
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