Helios and Matheson Analytics Inc (NASDAQ: HMNY) is a stock that we’ve covered quite a bit lately, predicting the demise of the company. So far, the nail has been hit on the head, with the stock continuously falling to record lows. Now, there’s a big vote taking place today that I believe is yet another sign that dilution will not stop and the company will eventually make it to zero. Today, we’ll talk about:
- The vote that’s taking place today and why it’s a sign that more dilution is coming;
- what we’re seeing from HMNY in the market; and
- what we’ll be watching for ahead.
HMNY Votes On Reverse Split
Today is the day that Helios and Matheson Analytics shareholders will vote with regard to a reverse split, and it’s a massive one. In fact, the company is hoping to move forward with a 1-for-250 reverse split. That’s not a typo my friends, that’s the actual number. Ultimately, if approved, every 250 shares owned will be consolidated into just one share of HMNY.
In my opinion, this is yet another sign that ore dilution is coming. Since acquiring a majority stake in MoviePass, the company has moved forward with several offerings of common stock. Ultimately, the company has been raising funds from the public in an attempt to continue to cover the cost of growing losses in MoviePass.
Unfortunately, there’s no sign that these growing losses will slow. At the end of the day, reducing the price of MoviePass to about the cost of a single movie ticket, when the company pays full price for each movie seen by a subscriber was a horrible move. As a result, the compnay is destined to continue generating losses. Now, if the reverse split is approved, HMNY will have more room fall.
If the reverse split takes place, at current levels, HMNY will trade at about $25 per share. This will put the stock well over the NASDAQ listing rule requiring publicly traded companies to maintain a price of $1 per share or more. However, the company only needs to do a 1-for-10 to regain listing, and manybe a 1-for-15 reverse split to leave some room for movement in the stock. The 1-for-250 simply shows that the company is expecting further declines and is working to try and maintain its listing in the long run. So, I believe that this is yet another sign that more dilution is ahead and that the stock will see further dramatic declines should the ridiculous reverse split be approved by shareholders.
What We’re Seeing From The Stock
While one of the most ridiculous reverse split transactions in the history of the market is on the table, investors, either blinded by losses they are trying to recover, or just blindly getting involved, are pushing the Helios and Matheson Analytics upward in the market today. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:12), HMNY is trading at $0.11 per share after a gain of $0.0050 per share or 4.81% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on HMNY. In particular, we’re interested in following the story surrounding the reverse split to see if investors do indeed approve the plans. We’ll also be watching for more signs that the company is grabbing for straws, hoping to stay afloat. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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