Last December, the board of JDS Uniphase
Indeed, the company appears to have reached that target and is now going ahead with the reverse split (stock merge?). On Oct. 17, any JDSU stock you own will be converted into one-eighth as many shares with the ticker JDSUD, which will then revert back to trading as JDSU about 20 trading days later. Any fractional shares that result from the switch should be paid out in cash. The price of the stock, convertible notes, and stock options will multiply by eight, and you're left with the same cash value in JDSU stock as you had the day before. Assuming that the share price at the time of writing ($2.22) holds until then, the new shares should trade around the $17.76 price point.
Stock splits are usually not newsworthy to a Fool, as they amount to changing five pennies for a nickel, or the other way around. However, there are times when a split can have real effects on a stock's performance. This is one such case.
JDSU shares have traded below the magical $5 barrier for years, making it look like a risky penny stock. Staying there for too long will endanger the company's good standing in the Nasdaq
So has JDS Uniphase really turned a corner worthy of newfound respect? The early signs are there, but only time will tell for sure.
For further Foolishness:
- Last year, Fellow Fool Nate Parmelee wondered who would buy JDSU at any price.
- Smash the Market
- Read what CAPS players think about this company.
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