Conexant Will Try The Reverse Stock Split Game (CNXT)

By Douglas A. McIntyre Updated Mar 26, 12:46PM EDT · Published Feb 22, 9:06AM EST

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Conexant Systems Inc. (NASDAQ: CNXT) is going to try a reverse stock split to juice its shares. As the stock trades 6 million shares per day and is at the very lowest-end of its $0.55 to $2.09 trading range over the last year, it is of little surprise that the company will try this. Conexant was literally a $100+ stock at one time back in the tech bubble days.

In a filing, the company said that shareholders at the annual shareholders meeting approved a proposal that would allow for a reverse stock split for a period of up to one year. The company has also noted that John Marren, who came over from the old GlobespanVirata days, has resigned from the board in conjunction with its annual shareholders meeting.

This is one we have covered with caution in our weekly "10 Stocks Under $10" letter for quite some time. The company is outside of listing requirements over its minimum price, making this even less of a surprise. Other companies that have pursued reverse stock splits in recent times have been tech companies such as Sun Microsystems, JDS Uniphase, Nortel, and others. You can ask around about the opinions of a reverse stock split, but you’ll find more indifference than anything.

Jon C. Ogg
February 22, 2008

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.