In Finance and Stock Market, River Stock Split is a process, to break the existing stocks or shares into small units of shares and make them more valuable for buyers and sellers.
Although, everyone follows the share market tips and equity trading tips. If a company is not performing well in the stock market then in these distressing circumstances, this process rings the danger bell for the company and breaks the shares.
As this is really helpful to face a distressing situation but it has a dark side also. Reverse stock split gained popularity during the post-dot-com era. More than 700 companies have headed to take Reverse Stock-Split in 2001.
Here are the examples of Reverse Split:
Laboratory Corporations of America holdings (NYSE: LH) has suffered for years on low prices and In 2000, decided to split. Which was1-For-10 Reverse-Split.
At Present, It trades over $170 per share.
Booking Holdings Inc.(NASDAQ: BKNG) split as 1-For-6, reverse stock split, in 2003. At present, it trades over $1,900 per share.