After Its Reverse Stock Split, Should Investors Feast on Beyond Meat Stock, or Is It Time to Stick a Fork In It?
The reverse split gives Beyond Meat stock a reprieve from delisting worries, but will it do anything with that opportunity?
Overview
Beyond Meat (NASDAQ: BYND) has struggled in recent years. The issues came to a head on Aug. 14, when the company executed a 1-for-30 reverse stock split. By rule, if a stock traded on the Nasdaq falls below a price of $1 per share for more than 30 straight days, it is put on notice that it's at risk of being delisted from the exchange. Beyond Meat has been in that danger zone for most of this year, so a reverse split was necessary for it to maintain its listing.
On the surface, this changes nothing for the food company, as it left shareholders with one-thirtieth of the number of shares, but increased the value of each new share by 30-fold. Neither the market cap of Beyond Meat nor the issues faced by its underlying business were effected.
Details
Nonetheless, the action may still leave investors wondering whether Beyond Meat is a generational opportunity or a falling knife. Although now may not be a time to stick a fork in Beyond Meat, this is probably not a great time to buy the stock, and here's why.
Source
Originally published at www.fool.com.
Related Articles
- Second straight rate hike for Asia’s number-three economy as Nvidia-led AI expansion continues
- My mother, 91, has dementia. Every bank says I need her signature to unlock her $100,000 stock certificate. What can I do?
- SpaceX Stock Trades Near $140 While Wall Street's Average Target Sits Above $232. Who's Right?