I agree, but also proven & accelerating revenue growth, and ideally other fundamentals like margins and profit or eps as well. Solid technicals plus accelerating fundamentals together are the ingredients needed for a successful r/s. And by successful I mean when the r/s is completed not only are their many fewer o/s, but the share price not only doesn't drop back down, but firms and rises further.
When these all come together and a r/s split is done for a penny stock or a low single digit dollar stock, it can also drive share price higher afterwards as institutional or Big Money investors can begin to invest, which they will want to do with the strong fundamental growth story confirmed and supporting the technical trend.
The problem with most r/s's is that crappy penny or sub-penny players do them out of desperation, thinking a good sounding story not yet confirmed by improving fundamentals will help them achieve their goals or even save them. It never works that way, but that is where the bad reputation of r/s's comes from.
We all can decide for ourselves perhaps come March or April if they stick to their plan if this company fits the successful or failure model for an r/s. But doing an r/s is not necessarily a bad thing, and with their bad reputations can even present buy or add opportunities on a reactionary and temporary pullback post r/s. GLTA
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