MIAMI - Safe & Green Holdings Corp. (NASDAQ: SGBX), a company specializing in modular structure fabrication, has declared a 1-for-20 reverse stock split. The change is scheduled to take effect at the beginning of trading on May 2, 2024. This decision follows the authorization granted by shareholders at the annual meeting on December 6, 2023, which allowed the board to determine the specific ratio within the approved range.
The reverse stock split aims to comply with Nasdaq's minimum bid price requirements and other listing standards. Paul Galvin, Chairperson and CEO, expressed that this move is expected to improve the marketability of the company's shares, tighten the public float, and enhance the capital structure while maintaining optimism about the company's prospects.
When the reverse stock split is implemented, every 20 shares of issued and outstanding common stock will consolidate into one share. This will not alter the percentage ownership interest of any shareholder. No fractional shares will be distributed; instead, shareholders will receive a cash payment for any fractional share entitlements. Stockholders do not need to take any action as adjustments will be made electronically by the company's transfer agent, Equiniti Trust Company LLC, and for beneficial holders by their respective brokers or banks.
Safe & Green Holdings Corp. operates in the modular solutions industry, catering to various sectors with safe and eco-friendly construction options. The company's subsidiary, Safe and Green Development Corporation, is a real estate development firm focusing on prefabricated modules for site development.
This announcement is based on a press release statement.
InvestingPro Insights
In light of Safe & Green Holdings Corp.'s (NASDAQ: SGBX) recent announcement of a reverse stock split, it's pertinent to consider the company's financial health and market performance. According to real-time data from InvestingPro, SGBX is operating under considerable financial stress. The company has a market capitalization of a mere 2.34 million USD, reflecting the market's valuation of the business. Additionally, the Price / Book multiple, which compares the market's valuation to the company's book value, is at a low of 0.42. This could indicate that the stock is undervalued or that investors are not confident in the company's ability to generate future profits.
Moreover, the firm's revenue has seen a decline of 35.04% over the last twelve months as of Q3 2023, which raises concerns about its growth prospects. The company's financial struggle is also evident in its gross profit margin, which stands at -2.2%, indicating that it is not only failing to make profits but also losing money on its core operations.
InvestingPro Tips suggest that SGBX is quickly burning through cash and may have trouble making interest payments on its significant debt burden. The stock price has also been highly volatile and has been moving in the opposite direction of the market. For investors considering whether to stay the course or sell their shares, these tips could be crucial. There are 18 additional tips available on InvestingPro, which could provide further insights into the company's financial position and stock performance.
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