Beasley Broadcast Group Inc. (NASDAQ:) has enacted a 1-for-20 reverse stock split of its Class A and Class B common stock, effective today. The adjustment was made official through a Certificate of Amendment to its Amended and Restated Certificate of Incorporation filed with the Secretary of State of Delaware.
The reverse stock split, which became effective as of 11:59 p.m. Eastern Time today, means that for every 20 shares of Beasley Broadcast Group’s common stock held by a shareholder, they will now own a single share.
No fractional shares will be issued in the process; instead, the company will compensate shareholders with cash payments for any resulting fractional shares based on the closing sales price of the Class A Common Stock on the Nasdaq on the effective date.
Following the reverse split, trading of the company’s Class A common stock will continue on the Nasdaq under the ticker symbol BBGI. Trading on a reverse stock split-adjusted basis is expected to commence tomorrow or as soon as practicable thereafter. The stock will trade under a new CUSIP number, 074014 200, post-split.
The decision for this corporate action was detailed in the company’s definitive information statement filed with the U.S. Securities and Exchange Commission on September 3, 2024. The full text of the Charter Amendment is included as Exhibit 3.1 in the company’s latest 8-K filing.
The reverse stock split is aimed at increasing the per-share trading price of the company’s common stock, potentially regaining compliance with Nasdaq’s minimum bid price requirement.
Beasley Broadcast Group, headquartered in Naples, Florida, operates radio stations across the United States. This strategic move is reflected in the company’s continuous efforts to manage its capital structure and enhance shareholder value. Information regarding the reverse stock split is based on a press release statement.
In other recent news, Beasley Broadcast Group has approved a reverse stock split of its common stock at a 1-for-20 ratio. This move, aimed at complying with Nasdaq’s minimum bid price requirement, is set to take effect on September 23, 2024. The company’s Class A Common Stock is expected to start trading on a split-adjusted basis on the Nasdaq the following day.
Equiniti Trust Company, LLC will serve as the transfer and exchange agent for this reverse stock split. The split will not affect the par value of the common stock or the authorized shares, and stockholders’ percentage ownership and voting power will remain relatively unchanged.
In recent financial developments, Beasley Broadcast Group reported mixed results for its second-quarter 2024 earnings. Total revenue saw a decline of 4.8%, and same-station revenue decreased by 2%. However, digital revenue increased by 10.2%, now accounting for 21.5% of the total revenue. Adjusted EBITDA also rose by 11.4% to $8.8 million.
InvestingPro Insights
As Beasley Broadcast Group Inc. (NASDAQ:BBGI) navigates through its reverse stock split to potentially improve its per-share trading price and meet Nasdaq’s requirements, the company’s financial health and market performance provide additional context for investors. According to recent data from InvestingPro, BBGI has a market capitalization of approximately $14.58 million and is trading at a low Price / Book multiple of 0.1, indicating that the company’s stock might be undervalued relative to its assets. Despite a challenging period with a revenue decline of 6.38% over the last twelve months as of Q2 2024, Beasley Broadcast Group maintains liquid assets that exceed its short-term obligations, which could offer some financial flexibility.
InvestingPro Tips highlight that BBGI operates with a significant debt burden and has been quickly burning through cash, which could raise concerns about its long-term financial stability. The stock has also experienced a substantial decline over various time frames, including a 45.39% drop in its one-year price total return as of the same period. With these factors in mind, investors may want to consider the broader financial picture presented by InvestingPro, which includes over 11 additional tips available to provide deeper insights into BBGI’s performance and potential investment risks.
For those considering an investment in Beasley Broadcast Group, the InvestingPro Fair Value estimate stands at $0.62, suggesting a potential upside from the previous close price of $0.49. As the company proceeds with its reverse stock split, these InvestingPro metrics and tips could be instrumental in making informed investment decisions.
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