There are many types of splits. What people should
Post# of 75378
Posted On: 07/05/2016 3:18:11 PM
There are many types of splits. What people should look at is the purpose of the split. I could write a book on splits and their purpose but since we are talking about a reverse split so example:
1 for 2 = 100 shares becomes 50 shares, The share price before the split =$1.00 now becomes $2.00 so at the time of the split the value is exactly the same. Now as to the purpose? To achieve an up list to meet the requirements in a company that is growing the $2,00 price will grow very fast. What also must be taken into consideration is the earnings. Huge sales will produce large earnings and because their are 1/2 the shares the earnings will in effect be double. Its not all bad and in many cases very good., because earnings grow and share price grows accordingly..
Now the case of RMHB, with distribution growing and sales increasing I expect by years end we should be in a much better position for higher earnings. The word is Patience.
1 for 2 = 100 shares becomes 50 shares, The share price before the split =$1.00 now becomes $2.00 so at the time of the split the value is exactly the same. Now as to the purpose? To achieve an up list to meet the requirements in a company that is growing the $2,00 price will grow very fast. What also must be taken into consideration is the earnings. Huge sales will produce large earnings and because their are 1/2 the shares the earnings will in effect be double. Its not all bad and in many cases very good., because earnings grow and share price grows accordingly..
Now the case of RMHB, with distribution growing and sales increasing I expect by years end we should be in a much better position for higher earnings. The word is Patience.
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