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Microcap & Penny Stocks : 1ST MIRACLE GROUP (MVEE), founders last co. went $0.20-$46
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To: bottomfish who wrote (1555)11/4/1998 6:29:00 AM
From: Stephen Goldfarb   of 5541
 
Barton: You are theoretically correct. A reverse split is often entered into by a company to reduce the number of shares and/or to increase the per share price. The proportion of the company owned after the split is the same. If there was a 1 for 10 reverse split of MVEE at a current price of .10, there would remain 9 million shares outstanding at a price of $1.00. The problem begins there. If there is insufficient demand for the shares, the new price can erode back from whence it came. That is, if investors perceive a mediocre future, the price may, and is probably likely to, drift downward. Or investors may sell. Either way a shareholder ends up with a significantly lower value then before the split. It is sometimes said that in the absence of positive developments, share price will fall on its own weight.

Steve
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