Replies to post #46913 on Kraig Biocraft Laboratories Inc (KBLB)

[downsideup]

The other reason a forward split can be useful is when the number of shares available in the market is so small that it inhibits liquidity... and, then, making more shares can shake a few loose and stimulate trading... That's really just a matter of "right sizing" the capital structure... to adjust the share count for some feature in the market conditions that requires it.

[bananarama]

Mojo,
You state, "the stock did essentially nothing for over a year after the split...but it eventually did go up with news...as it would have with or without the f/s..."

I have found over these long years fighting the market that when a company does a 2,3,or 4 for one split, that it usually goes down a bit or basically stays the same AFTER THE SPLIT.

If you look at Coca Cola (KO), a stock I had for about fifteen years, it had two 2x1 splits. I started out with 250 shares, and I ended up with 1,000. However, for almost six years, the stock sat in the mid 40's and went nowhere. Then, all of a sudden, around the seventh year, it took off from the mid 40's to where it is today, in the low 80's. Now, they declared another 2x1 split.

This is how money is made. You buy a company which you feel as a potential product, and you hold on through thick and thin. With KBLB

[first mike]

Hi Mojo,

I agree completely with your post.

Kim Thompson stated at the time of KBLB's forward split that the reason for it was to keep the stock more accessible to small investors, exactly the "good" reason for a FS that you mentioned.
In the land of OTC stocks in very risky companies, (and at the time of the FS KBLB was unquestionably a very risky company) $1.00 is a relatively high price.
There are many companies listed on NASDAQ that trade for about a dollar, and NASDAQ will not de-list a company unless its price falls below a dollar for a long period of time.

Mike L.