Electronic Cigarettes Intl Group Ltd(OTCMKTS:ECIGD) lost about 25 percent of the market value this week after performing a one-for-fifteen reverse stock split.
Investors were obviously unhappy with the firm’s recent shenanigans. The displeasure is very obvious and there is a good reason for that. This is because shareholders had given a voting in favour of reverse stock split of ECIG stock “between 1-for-5 and 1-for-20 ” whereas investors were anticipating that the number would be on the lower side of what was allowed.
The company’s stock prices plummeted as a result of this to almost $1.38 a pop (adjusted price) with a dollar volume of about $3 million. Indeed, it was extremely unpleasant as shareholders were hoping to do a long term investment.
But, the cause of more worry is that the panic selling may continue and the company’s stock price may plummet completely defeating the reason for the whole “reverse split” affair.
It would be grows understatement to say that the turn of events may cause harm to investor value. Opportunistic traders and dedicated investors may consider odds of ECIG suffering a huge drop and may want to take action accordingly as soon as possible.