Axcella Health (NASDAQ:AXLA) stock is taking a beating on Friday after the biotechnology company announced plans for a reverse stock split.
According to Axcella Health, shares of AXLA stock are going to undergo a 1-for-25 reverse split. This split will go into effect after markets close on Sept. 18, which will see the stock start trading on a split-adjusted basis on Sept. 19.
Investors will note that Axcella is moving forward with the reverse stock split to increase the trading price of its shares. This comes as it seeks to regain compliance with Nasdaq listing standards.
Nasdaq rules require stocks to maintain a minimum bid price of $1 per share. To put that in perspective, shares of AXLA stock closed out Thursday at a price of $1.01 cents. Falling below that minimum bid price for too long would see the shares delisted from the exchange.
What This Means for AXLA Stockholders
The reverse stock split will see Axcella consolidate every 25 shares of AXLA into a single share. This will increase the share price of the stock without changing the company’s market capitalization. It also won’t alter the stakes that investors have in the company.
AXLA stock is down 24.2% as of Friday morning.
There’s even more stock market news for investors to read about below!
We’re offering up all of the hottest stock market news that traders need to know about on Friday! A few examples of that include what’s going on with Moleculin Biotech (NASDAQ:MBRX) and AgriFORCE Growing Systems (NASDAQ:AGRI) stock today, as well as the biggest pre-market stock movers this morning. All of that news is ready to go at the links below!
More Friday Stock Market News
- Why Is Moleculin Biotech (MBRX) Stock Is Moving Today?
- Why Is AgriFORCE Growing Systems (AGRI) Stock Up 74% Today?
- Today’s Biggest Pre-Market Stock Movers: 10 Top Gainers and Losers on Friday
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
