Why Sonnet BioTherapeutics (SONN) Shares Are Down 19% Today
Portfolio Pulse from Henry Khederian
Sonnet BioTherapeutics (SONN) shares fell by 19.9% after announcing a 1-for-8 reverse stock split to meet Nasdaq's $1.00 minimum bid price requirement. The reverse split will reduce outstanding shares and adjust warrants, stock options, and equity incentive plans.
September 25, 2024 | 6:25 pm
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Sonnet BioTherapeutics shares dropped nearly 20% after announcing a 1-for-8 reverse stock split to comply with Nasdaq's minimum bid price rule. This move will significantly reduce the number of outstanding shares and adjust related financial instruments.
The reverse stock split is a significant corporate action aimed at maintaining Nasdaq listing requirements, which often leads to a negative short-term market reaction due to perceived financial instability or desperation. The stock's substantial drop reflects investor concern over the company's ability to maintain its listing and future growth prospects.
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