Financial Calculators

Reverse Stock Split Calculator

This remarkable tool will calculate a stock's new value after a reverse stock splitting.

Reverse Stock Split Calculator

Stock Split Ratio

Table of contents

Are You at Risk of Losing Money with a Reverse Split?
What is a 1 to 8 reverse stock split?
What are the Advantages to a Reverse Stock Divide?
What is the downside to a reverse stock split?
Why are Penny Stocks Performing Reverse Splits?

What is a "Reverse Stock Split"?

A reverse stock splitting is where the number of shares of a stock are consolidated to make more money. It's also known by the names stock merge, share rollback, and stock consolidation. The purpose of this is to increase each stock share's value. Because people have fewer shares, however, this doesn't increase its value.

Are You at Risk of Losing Money with a Reverse Split?

Reverse splits are when a company's stock shares become fractions of one another. A reverse split equals one for ten. This means that every ten shares will become one share. Now you'll have 1000 shares even if you owned 10,000 shares. But the value will remain the same.
Some small shareholders might also cash out and get cash for their shares. A reverse split can also trigger trading which could lead to investors losing money. Investors may also be able to make money if they decide to buy shares that drive the value higher.

What is a 1 to 8 reverse stock split?

A 1 to 8 reverse stock splitting will result in every share becoming 1/8th of one share or.125 Shares. An easy way to put it is that 8 shares will result in 1 share. That is, one share is equal to 8 shares. Each share would be worth $1. This would give you $8 worth of stock. You have only one share of $8 stock.

What are the Advantages to a Reverse Stock Divide?

Reverse stock splitting has several benefits. First, they do not run the risk of being delisted from NASDAQ or NYSE. If a company's stock prices drop and the price of its shares falls below $1, they may delist it.
Additionally, reverse stock splitting can help improve the company’s image. Investors might view low stock values as negative and may buy more shares than they sell. If investors are willing to invest, they can help push the price up.

What is the downside to a reverse stock split?

The reverse stock split comes with some disadvantages. Reverse stock splits can lead to liquidity problems. There will be fewer shares. Some people see a reverse stock splitting as a sign that the company is in trouble. A reverse stock split can lead to a decrease in value. It is not uncommon for shareholders to sell their shares.

Why are Penny Stocks Performing Reverse Splits?

The shares of penny stocks, which are small companies that trade at a fraction of a dollar to five dollars, can be traded at a price as low as one cent. People love to speculate by purchasing large numbers of shares. However, this can be dangerous. These small businesses often go out of business and are high-risk.
After they have sold all their authorized stock and done a reverse split, they are well-known for it. This allows the stocks to look more attractive and can range from a dollar to twenty dollars, thirty dollars, or even more.
Reverse stock splitting is when a company consolidates its stock to increase its value per share. Although the overall value will remain the same as before, you will have fewer shares.

Parmis Kazemi
Article author
Parmis Kazemi
Parmis is a content creator who has a passion for writing and creating new things. She is also highly interested in tech and enjoys learning new things.

Reverse Stock Split Calculator English
Published: Mon May 16 2022
In category Financial calculators
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