I did not want to see either a reverse stock split or a share buyback for one simple reason. It costs INSP money to go down either path and I'd rather see money go to other needs.
But now that it is done, it is done. I will vote for the reverse split as will most, if not all shares held by company officers, directors, management, and most employees.
The reverse split will happen.
Ignore statistics on what other companies have done after their stock splits...past performances are no indication of future results...not only that but you cannot compare INSP with any other company.
INSP is clearly shooting for a stock price above 5.00 per share. This threshold is for institutional investors.
INSP claims to have around 308 million in cash, cash equivalents, investments, and misc. credits. 30.9 million shares goes into that number 9.96 times.
At current levels, institutions will not buy a stock valued at .45 or post split valued at $4.50 even though it has cash of almost $10.00 per share.
Nothing has changed for the company other than it is now conceivable that institutions will place insp on their investment research lists again and the company will be looked at all over again by paid researchers.
What these researches will uncover, IMHO, are the values seen by most of the average posters on this board. Incidentally if INSP earns 129 million dollars in revenues this year, that is revenues of $4.14 cents per share. $4.14 revenues per share in a company with zero debt will look very attractive on its own. This of course, ignores all the revenue streams and growing metrics. It further assumes that INSP stays as rigid as it has been in cost cutting and keeping expenses down.
So we now talk of all metrics being the same as before the split, only the numbers are now of a ratio more accustomed to professional number crunchers. |
