I like MOVE fundamentally, but as a trader, I like the stock's technical range at it's current price. If and when they go through with the reverse split, I'm out. Reducing the float from 117 million shares to about 17 million shares will have absolutely no positive effect on how this stock trades. Look at ZIPR with its float of 7 million...dead in the water.
After the split, Shorts will come in, since we a have a couple more years of pain in the housing market, and bring the stock from Approx. $8 to $5 or less in a few months...which would bring MOVE's current pre reverse split value to about $1.21. Who in the hell wants that...unless you're a short. Most retail investors can't short stocks under $5 because of brokerage house restrictions. So, I think MOVE has a greater chance of doubling to $4 from it's current price than doubling to $16 after the split.
MOVE's management is about to destroy this stock, which is sad considering the stock's potential to gradually rise from here.
I think this stock has nowhere to go but up. When the institutionals recognize the intrinsic value of Move vs Zillow, they will bump Move up quite nicely. The split will be played well, at the right time and with a nice lineup of big pre-sales chomping at the bit... Nierenberg wouldn't have it any other way. Move is still the best managed, best positioned real estate.com in my opinion.
Agreed, there will be more demand by certain institutional investors but at the same time the shorts(hedge funds and specultors) will be more emboldened and motivated to sell and force the pps lower.
There is no easy answer and I agree that it would be positive development at the right time. However, at the the current market environment I don't think a reverse stock split would help share appreciation. On the other hand, it couldn't get much worse than it has been lately.
whats the point of 1 for 4? do 1 for 20 and make it count, buy out the partials, leaving the remaining in stronger hands making the much lower float suddenly hard to borrow.
ssainvestin.....also , Helfstein, Jason from Oppenheimer & Co , on the CCall , thanked management for taking these steps of the Company also announcing plans to streamline capital structure, including redemption of $70 Million of Series B preferred stock, 1-for-4 reverse stock split, and $25 million stock buyback program...It was on first Q CCall.....