BlackSky Technology Announces Reverse Stock Split
BlackSky Technology Inc. announced a 1-for-8 reverse stock split of its Class A common stock yesterday. The Board of Directors and stockholders approved the decision during the company’s annual meeting held virtually. Therefore, the reverse split is set to be effective at 4:15 p.m. Eastern Time on September 6, 2024. Consequently, trading for the adjusted shares will commence on September 9, 2024, under the existing NYSE symbol “BKSY.” The reverse stock split will convert every eight shares into one new share; consequently, proportional adjustments will be made to the exercise prices and outstanding options.
BlackSky Technology Reverse Stock Split – Market Impact
Following the announcement, BlackSky’s stock has experienced a significant decline.
Financial Overview and Market Performance
BlackSky Technology Inc. currently has a market capitalization of $128.96 million with revenue totaling $105.94 million for the trailing twelve months. However, despite this, the company reports a net income of -$28.32 million, translating to an earnings per share (EPS) of -$0.20. The stock has 146.53 million shares outstanding and traded with a volume of 3,619,248 shares. The stock’s recent trading range has been between $0.840 and $1.770, with the latest close at $1.110. The company’s beta stands at 0.99, indicating volatility close to the market average. Analysts currently have a strong buy rating on the stock, with a price target set at $2.75, reflecting a potential upside of 212.46%. The latest earnings release date was August 8, 2024.
BlackSky Technology Reverse Split Details and Adjustments
Each eight shares of the current Class A Common Stock will convert into one new share. The reverse split will keep the number of authorized shares and the par value unchanged at $0.0001 per share. Consequently, the company will adjust the exercise prices and the number of shares issuable under outstanding options, restricted stock units, and equity incentive plans.
Details on Warrants and Fractional Shares
Each outstanding warrant will adjust, becoming exercisable for one-eighth of a share at a new exercise price of $92.00 per whole share. Furthermore, they will not issue fractional shares. Stockholders who would otherwise receive fractional shares will instead receive a cash payment based on the pre-split number of shares multiplied by the closing price on the effective date.
Continental Stock Transfer & Trust Company will serve as the transfer and exchange agent for this reverse split. The market’s reaction highlights investor apprehension regarding this structural adjustment, emphasizing the need for careful monitoring of BlackSky’s stock performance post-split.
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