Beasley Broadcast Group announces 1-for-20 reverse stock split By Investing.com
Beasley Broadcast Group Inc. (NASDAQ:) has conducted a 1-for-20 reverse stock split of its Class A and Class B common stock, effective today. The amendment was formalized by a Certificate of Amendment to its Amended and Restated Certificate of Incorporation filed with the Delaware Secretary of State.
The reverse stock split, which became effective at 11:59 pm Eastern Time today, means that for every 20 shares of Beasley Broadcast Group common stock held by a shareholder, they will now own one share.
No fractional shares will be issued in this process; instead, the company will compensate shareholders with cash payments for any fractional shares issued based on the closing sales price of the Class A Common Stock on Nasdaq on the first date.
Following the reverse split, the company's Class A common stock will continue to trade on Nasdaq under the ticker symbol BBGI. Trading on the basis of the change in stock split is expected to begin tomorrow or as soon as possible thereafter. The stock will trade under a new CUSIP number, 074014 200, after the split.
The company's decision to take this action is described in the company's definitive information statement filed with the US Securities and Exchange Commission on September 3, 2024. The full text of the Memorandum Amendment is included as Exhibit 3.1 in the company's most recent 8-K filing.
A reverse stock split is intended to increase the trading value per share of a company's common stock, which may also be obtained to comply with Nasdaq's minimum bid price requirement.
Beasley Broadcast Group, headquartered in Naples, Florida, operates radio stations throughout the United States. This strategic move is reflected in the company's ongoing efforts to manage its capital structure and improve shareholder value. Information regarding the reverse stock split is based on a press release.
In other recent news, Beasley Broadcast Group authorized a reverse stock split of its common stock on a 1-to-20 basis. The move, intended to comply with Nasdaq's minimum bid price requirement, is expected to take effect on September 23, 2024. The company's Class A Common Stock is expected to begin trading on a modified basis on Nasdaq the following day.
Equiniti Trust Company, LLC will act as transfer and exchange agent for this reverse stock split. The split will not affect the price of the common stock or authorized shares, and the shareholders' ownership percentages and voting power will remain relatively unchanged.
In a recent financial development, Beasley Broadcast Group reported mixed earnings results for its second quarter of 2024. Total revenue was down 4.8%, and same-channel revenue was down 2%. However, digital revenue increased by 10.2%, now accounting for 21.5% of total revenue. Adjusted EBITDA also increased 11.4% to $8.8 million.
InvestingPro Insights
As Beasley Broadcast Group Inc. (NASDAQ:BBGI) is navigating reverse stock splits to improve its trading price per share and meet Nasdaq requirements, the company's financial health and market performance provide more context for investors. According to the latest data from InvestingPro, BBGI has a market capitalization of $14.58 million and trades at a low Price/Book multiple of 0.1, indicating that the company's stock may be undervalued relative to its assets. Despite a challenging period of revenue decline of 6.38% in the last twelve months from Q2 2024, Beasley Broadcast Group maintains liquid assets that exceed its short-term obligations, which can provide some financial flexibility.
InvestingPro Tips highlighted that BBGI was operating under a heavy debt load and was quick to burn cash, which could raise concerns about its long-term financial sustainability. The stock has also experienced significant declines over different periods, including a 45.39% drop in its one-year price return over the same period. With these factors in mind, investors may want to consider the comprehensive financial picture presented by InvestingPro, which includes more than 11 additional tips available to provide in-depth information on BBGI's performance and potential investment risks.
For those considering an investment in Beasley Broadcast Group, the InvestingPro Fair Value estimate stands at $0.62, suggesting a potential upside from the previous close price of $0.49. As the company continues its stock split reversal, these InvestingPro metrics and tips can be helpful in making informed investment decisions.
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