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Raymond, reverse split for MDIH, the sooner, the better. Here is why...
I believe the perception you describe will be changed by the shear quantity of future reverse splits coming up, so that Companies can remain listed.
As a result of the ensuing publicity, the investing public will become aware that it is not necessarily a fatal stigma or flaw to have a reverse split.
In the case of MDIH, for example, my guess would be that it is mostly owned by seasoned investors (Gator for example) who have run the figures beforehand and concluded that the Company was grossly undervalued. To these people, a reverse split should make no difference, since the figures will still add up to the same results.
If the Company (MDIH) has:
1) positive earnings, say EPS of 22 cents to be conservative.
2) a PE of less than 3, when it should be at least 20
3) on that basis a price of .22 x 20 = $4.40/share
4) a current market value of 62 cents or seven times less than it is worth
5) a great business plan with the Millennium boost around the corner
6) no competition to speak of and a management that has so far well executed the business plan,
Then MDIH could not possibly suffer from a reverse split.
On the contrary, since that very perspective is probably depressing the stock, the sooner it happens, the better. Actually, within 2 days of being announced, I am willing to bet the stock will double from present levels.
Major Shortcoming: MDIH management has so far failed to take the interest of its shareholders into account and to market itself adequately to the investing public. Once it hires a skillful PR/IR firm, and Veritas which promotes ZSUN comes to mind, the Company and its investors will never look back, since the its business has excellent potential.
As soon as I get a chance, I will report on my phone conversation with the CFO a while back and the investor's package I received. Also, remember, quarterly results are nearly upon us and I hope for a good surprise.
Regards, F. Goelo + + + |
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