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Post by BlueCat on Sept 24, 2016 17:31:23 GMT -5
In the end, it's all about performance. A reverse split is a symptom of a stock that's in decline, not the cause of the decline. It sends an unfortunate signal but only matters if the underlying performance problem is not resolved. If we do a 10:1 reverse split and the stock goes up 50X on increasing sales, no one will complain. If we do the split and sales languish, we die either way. Funny how this topic comes up every so many months. I would agree its a symptom. But it seems to me that the trend will continue in its current direction, possibly accelerate that direction. Therefore, imagine this thing back up at $10. Shorts jump full in thanking MNKD for offering them another lucrative ride down to $1. Please sir. Can I have some more?No thank you. On the other hand, if sales increase and the trend reverses heading back up - I'd much rather reduce that float and have some shorts sell out because of the exposure - and thereby accelerate the increase. I think it essentially magnifies what's already underway.
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Post by hankscorpio7 on Sept 25, 2016 20:17:41 GMT -5
Funny how this topic comes up every so many months. I would agree its a symptom. But it seems to me that the trend will continue in its current direction, possibly accelerate that direction. Therefore, imagine this thing back up at $10. Shorts jump full in thanking MNKD for offering them another lucrative ride down to $1. Please sir. Can I have some more?No thank you. Would shorts want to risk that the entire company could be bought for $50m? It is all about proportions. The game stays the same. If most investors think this is a $100m company, it will be valued as such no matter how many shares. They don't have to do anything about delisting for some time. We will be so lucky to survive to that time.
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