When the market closed on July 16, Ashford’s stock was at $1.82. However, today it has one big fresh start: currently, the price is at $16.2, resulting in a tremendous 790% jump. What is the buzz? Last Friday, the company announced that it completed a reverse split of the company’s common stock at a ratio of 1-for-10, meaning that the Ashford’s common stock and equivalents were converted 1/10th of a share of the company’s common stock: from approximately 265.1 million shares to 26.5 million.
By using a reverse stock split, the company and its board of directors believe they can execute increased incremental demand for both its common stock and its options while also making the company’s stock more attractive to a wider range of potential long-term institutional investors, individual investors, and buy-side analysts.
On July 16, 2021, Ashford also completed the same procedure of the partnership units of Ashford Hospitality Limited Partnership, the company’s operating partnership (“Ashford Trust OP”). The number of outstanding partnership units of Ashford Trust OP got reduced from approximately 4.0 million units to 402,222.
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