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Albany Molecular Research Inc. Message Board

  • fantasticinvestor fantasticinvestor Aug 9, 2000 11:07 AM Flag

    re: "stock split"

    It amazes me the amateurs who don't realize that
    a stock split ally means NOTHING, NADA, NIL.
    Someone on one of the other boards said "more shares
    free".....uh, yeah with each share worth 50% less than it was
    the day before.

    People don't have to buy in
    even lots of 100. You can by 100 or 225 or 78 or 12
    shares of stock if you wish.

    Splits do not

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    • Sorry, you were wrong when you say a split means
      nothing.... You obviously are interpreting the commentts in
      an absolute value sense rather than an inherent
      value. In that aspect I would agree, the 'free' comment
      was simple....I do question YOUR 'amatuer' status
      when you do not address 'cost of odd lots',
      'liquidity', and 'shorting/liquidity issues'.... Rather than
      retype what I have said before about the
      'benefits' is an excerpt..(find it at any finacial info

      Companies split their stock to make the price more
      affordable to more investors. At a lower price, investors
      can buy even lots of the stock and avoid the high
      commissions attached to odd lot purchases. As a larger number
      of investors buy the stock, demand increases and
      thus a run-up in the stock price usually occurs. Also,
      stock splits create liquidity as existing shareholders
      find it easier to sell the stock when the price is
      affordable to others.
      The psychological effect the word
      "split" has on investors is rather strong. Some investors
      may automatically associate the word "split" with a
      lower price and a "good buying opportunity." There does
      seem to be a marketing hype to funds announcing a
      split. It�s possible that fund companies are trying to
      capitalize on investors� preconditioned favorable reaction
      to stock splits.

      Company Benefits: a company
      will split its stock in order to make the price of
      their stock more attractive (affordable) to investors
      by, in effect, dropping the price of the stock. A
      prospective purchaser of XYZ Company can now pick up a share
      of stock for $50.00 post-split. The potential is for
      more investors to begin buying the cheaper stock,
      creating activity and momentum for the company. There is a
      psychological aspect to lowering the price of a share in a
      company through a split, especially one that is popular
      or in a popular industry. Even though the actual
      value of a share is halved through a split, the
      impression to buyers is that they can now get a share of XYZ
      for half the price. Depending on the company and its
      industry, a share�s price can begin to rise right after a
      split, and in many cases can, over time, go back to
      where it was pre-split.
      Investor Benefits:
      shareholders of XYZ Company now have twice the shares they did
      before. Assuming the cheaper price entices new investors
      to buy, the activity in the stock will naturally
      cause the price to begin to rise. In the long run, as
      XYZ Company does well and the value of XYZ stock
      increases, then having more post split shares in your
      portfolio will have a compounding effect on your entire
      position in XYZ Company.

      If you want to banter
      about this, rather than fill up the AMRI baord..... My
      email is


    • shareholder approval.....there are only 50,000,000 shs authorized, used some for enzymed plus the split plus options.. not enough shs in the kitty for a 2 for one

      • 3 Replies to nelson481
      • have to believe directors, if not someone is going to take a hit. the shareholders. plenty of shares sold by insiders lately.

      • Nelson,

        Here's the detail of the

        The Company's transfer agent on August 24, 2000 will
        distribute the additional shares resulting from the stock
        split. The Company currently has approximately 14.9
        million shares outstanding. Upon completion of the split,
        that number will increase to approximately 29.8
        million shares.

        AMRI merged with Enzymed for


      • Here's the announcement from Yahoo

        Albany Molecular sets 2-for-1 stock split
        N.Y., Aug 7 (Reuters) - Chemistry research and
        development firm Albany Molecular Research Inc.
        (NasdaqNM:AMRI - news) on Monday said its board of directors
        approved a 2-for-1 stock split on the company's common

        The stock split, which will be paid out as a
        dividend, entitles each shareholder to receive a stock
        dividend of one additional share of Albany Molecular
        common stock.

        The dividend will be paid on Aug.
        24 to shareholders of record at the close of
        business on Aug. 8.

        The Albany, N.Y.-based company
        also reported a 58 percent increase in its net income
        for the second quarter to $5.9 million, or 38 cents a
        share pre-stock split, from $3.7 million, or 25 cents
        pre-stock split.

        Revenues for the quarter rose 51
        percent to $16.6 million from $11.0 million in the same
        quarter last year. Shares of Albany Molecular rose 1-1/8
        to close at 52-3/4 on the Nasdaq stock market.

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