Lots of people on this board providing good dd on both sides of the argument....but lots of others telling people telling what they should do/think.....I've done my own research and dd and I personally am in favour of it....the rest of you should take a break from this board and make up your minds as well....with all the facts though.
MC
New research indicates that reverse stock splits are usually good for investors.
According to a new report by Cleve Rueckert, Birinyi Associates senior equity strategist, there have been 14 stocks in the S&P 500 since 2000 that have undergone a reverse stock split. Of those fourteen stocks, twelve were higher one year after the effective date of the reverse split, two were lower. The average gain was a gigantic 62.55 percent.
The best performer: Titanium Metals . Titanium Metals rallied 350% in the year following the effective date of its 1:10 reverse stock split on February 18th, 2003.
The worst performer: Tyco . Tyco lost 25% in the year following the effective date of its 1:4 reverse stock split on July 2, 2007.
Citigroup announced a 1:10 reverse stock split Monday, effective after the close of trade May 6, 2011.
Here is the full list:
Reverse Stock Splits
Company
Stock Split
Effective Date
Pct. Change 1yr
| Lab Corp. of America (LH) |
1 for 10 |
5/4/00 |
121.49% |
| Raytheon (RTN) |
1 for 20 |
5/15/01 |
51.64% |
| Titanium Metals (TIE) |
1 for 10 |
2/18/03 |
350.95% |
| Priceline.com (PCLN) |
1 for 6 |
6/16/03 |
9.71% |
| Intuitive Surgical (ISRG) |
1 for 2 |
7/1/03 |
29.78% |
| CBS Corp. (CBS) |
1 for 2 |
1/3/06 |
20.61% |
| JDS Uniphase (JDSU) |
1 for 8 |
10/17/06 |
-5.48% |
| Tyco (TYC) |
1 for 4 |
7/2/07 |
-25.00% |
| Discovery Comm (DISCA) |
1 for 2 |
9/18/08 |
114.34% |
| Time Warner Cable (TWC) |
1 for 3 |
3/13/09 |
90.32% |
| Time Warner Inc. (TWX) |
1 for 3 |
3/30/09 |
84.87% |
| American Intl. Group (AIG) |
1 for 20 |
7/1/09 |
87.39% |
| E*Trade Financial (ETFC) |
1 for 10 |
6/2/10 |
2.80% |
| Motorola Solutions (MSI) |
1 for 7 |
1/4/11 |
4.83% |
Source: Birinyi Associates
