This is purely for optics as far as I am concerned. Nothing has changed fundamentally for POET.
Yes there are many stocks we have all been in that the reverse stock split has been the death notice. However some that we have all been in are up from the original reverse stock split SP. If we all start screaming SAY NO!!! what do you think that is going to say to potential investors and do to the SP. I get it....I wish they could keep the share price up over 2 bucks and get the listing on the Nasdaq and the TSX but maybe they are frustrated with the manipulation as well and feel it is time to be taken seriously.
This is not a drowning NASDAQ stock trying to save it's ass. It is a sound move from their stand point and I think we all need to relax! Nothing has changed.
Why reverse splits are common in penny stocks
Penny stock companies consolidate their shares more frequently than any other size of investment. They may take this step to achieve any of the following goals:
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Maintain or gain a stock market listing. If a company needs a minimum share price to be listed on their exchange but fall below that threshold, it could do a reverse split to bring the share price higher. For example, a 25¢ stock could consolidate 1 for 10, bringing the theoretical price to $2.50 and reducing the number of outstanding shares to one-tenth of the original amount.
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Increase perceived legitimacy. Higher-priced stocks typically imply higher quality companies. Although share price really has nothing to do with the success or prospects of the business, a higher prices does look better to investors and clients.
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Decrease outstanding shares. Many penny stocks have far too many shares available because of their tendency to continually issue new stock to raise money. One way to quickly reduce the outstanding shares is to consolidate.
