YXT.com, 10-for-1 reverse ADS split announcement sends shares 4% lower
YXT.com disclosed a 1-for-10 reverse ADS split and said it would take effect on Monday. After the news, the stock fell about 4% on the announcement date. The key point for investors is that the number of ADSs and the trading unit will change.
YXT.com disclosed a 1-for-10 reverse ADS split and said it would take effect on Monday. Immediately after the news, the stock fell about 4% on the announcement date.
The company filing specified the split ratio as '1-for-10.' The effective time is stated in the filing as 'Monday'.
This split consolidates existing ADSs of 10shares into new ADSs of 1shares. After the split, the number of ADSs in circulation will decrease.
An ADS is an American depositary share, a certificate that makes shares of foreign companies tradable in the United States. One ADS corresponds to multiple ordinary shares.
A reverse ADS split is generally a procedure that reduces the number of ADSs and raises the price per share. In its disclosure, the company specified only the split ratio and effective time.
In trading between the announcement date and the effective date of the split, the way the number of ADSs held and the account balance are reflected may vary by brokerage. Investors should check their account statements.
As of now, no detailed statement from the company on the purpose of the split or additional plans has been confirmed within the scope of its disclosures.
Sources: Seeking Alpha Market News,Investing.com News
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