RICHMOND, Va. - Medalist Diversified REIT, Inc. (NASDAQ:MDRR), a real estate investment trust operating in the Mid-Atlantic and Southeast U.S., declared that its stock split plan will take effect today. The plan includes a reverse stock split followed immediately by a forward stock split of the company's common stock.
The reverse stock split, occurring at a 1-for-10 ratio, will consolidate every ten shares of common stock into one share. Immediately following, at 5:01 p.m. Eastern Time, a forward stock split at a 5-for-1 ratio will be implemented, converting each share of common stock into five shares.
This sequential stock split strategy is designed to restructure the number of shares without altering stockholders' percentage ownership in the company, except in the case of fractional shares resulting from the reverse split. These fractions will be settled in cash based on the closing trading price of the stock as adjusted after the reverse split.
The adjusted common stock will commence trading on The Nasdaq Capital Market under the ticker symbol "MDRR" with a new CUSIP number on July 3, 2024. Following the stock splits, the total number of outstanding shares will decrease from approximately 2.24 million to around 1.12 million.
Stockholders of record will receive detailed information from VStock Transfer LLC, the company's transfer agent, regarding their stock ownership post-splits. Those holding shares in brokerage accounts or "in street name" do not need to take any action as the adjustments will be made automatically.
This strategic move comes as part of Medalist Diversified REIT's ongoing efforts to manage its stock profile. While the press release includes forward-looking statements about the potential impact of the stock splits on the company and its stock trading price, it also cautions that such statements are not guarantees of future performance and are subject to risks and uncertainties.
The information provided is based on a press release statement from Medalist Diversified REIT, Inc.
In other recent news, Medalist Diversified REIT, Inc. has reported significant changes to its Board of Directors. A. Lee Finley was appointed as a Class II director, set to serve until the 2025 Annual Meeting of Stockholders. In a subsequent development, directors Timothy O’Brien and Charles S. Pearson, Jr. tendered their resignations, resulting in the Board resizing to five directors and Francis Kavanaugh stepping into the role of Chair of the Board.
These changes are part of the company's ongoing strategic and operational activities, aligning with its corporate governance policies. It is worth noting that these board transitions did not stem from any disagreements with the company's operations, policies, or practices.
Furthermore, these recent developments are part of the normal course of business and have been reported in a recent SEC filing. The company has emphasized that Finley's appointment and the subsequent resignations were not due to any pre-arranged agreement or any transaction requiring disclosure under SEC regulations.
InvestingPro Insights
As Medalist Diversified REIT, Inc. (NASDAQ:MDRR) implements its unique stock split strategy, investors are closely monitoring the company's financial health and market performance. According to the latest data from InvestingPro, MDRR has a market capitalization of approximately $16.22 million USD, reflecting the company's size within the real estate investment trust sector.
Despite a challenging market environment, the company has maintained a gross profit margin of 76.08% over the last twelve months as of Q1 2024, indicating a strong ability to control costs relative to its revenue.
InvestingPro Tips highlight that MDRR operates with a significant debt burden and may have trouble making interest payments on its debt. This is a crucial consideration for investors, as the company's financial obligations could impact its future performance and ability to return value to shareholders. Moreover, analysts do not anticipate MDRR to be profitable this year, which could affect investor sentiment and the stock's trajectory post-split.
For investors seeking a deeper analysis of MDRR's financials and market potential, there are additional InvestingPro Tips available at InvestingPro. These tips provide a comprehensive outlook on the company's valuation, profitability, and industry standing. Plus, by using the coupon code PRONEWS24, readers can get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription to access these valuable insights.
It's also noteworthy that MDRR's liquid assets exceed its short-term obligations, which could provide some financial flexibility in the near term. With a total of 11 additional InvestingPro Tips available, investors can gain a broader understanding of the factors that may influence MDRR's performance in the wake of the announced stock splits.
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