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leifsmith

09/05/13 12:41 PM

#71795 RE: Ubertino #71794

A RS has nothing to do with earning or not earning. If NNVC got to $5 by a reverse split it should not have any effect at all on market cap, i.e. the market's determination of the value of the company.

There may be a short-term decline because some people think a RS somehow bears on the value of the company, even though it's completely irrelevant. But if that decline happens it will just create a buying opportunity for others who realize that nothing has changed except for the better --- because now institutions can come on board who were, before the RS, prevented from buying because of the rules they live by.

I am not recommending a reverse split, but I'm interested in the assumption that it's a bad thing. I don't see that.