GME approves 4:1 stock split dividend.
(media.greatawakening.win)
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Makes the price point more accessible to more people allowing more buying pressure.
But this is a stock dividend, not a stock split. A 4:1 stock dividend isnt like a 4:1 stock split where all the math is just 4xed and 1/4thed, the 83 million shares will be given 3 new shares that have to be given their proper home. Since it has been illegally naked shorted (making synthetic shares that arent ever properly delivered or hedged against), the market makers and brokers will struggle to provide them to all the people who bought them.
This is NOT a stock dividend. The company says it is a "stock split in the form of a stock dividend" ... whatever the fuck that mean.
You are ignoring the "stock split in the form of a" language. Don't.
Let's look at it this way:
(a) If it was a cash dividend, they would pay the dividend in cash. But they don't have enough cash to pay a cash dividend.
(b) If it was a regular stock dividend, they would issue additional stock to current stockholders ... BUT ... they would pay for that out of cash ... which they don't have.
The company has a total market value of $9 billion (76 million shares outstanding x $120 per share).
IF they were going to just "give you 3 times the shares you have now* ... then they can't just give you pieces of paper (stock certificates), because those have ZERO value by themselves. SOMEBODY has to buy them.
Usually, they use that extra stock (authorized but not issued) to raise cash by selling them to investors in a secondary stock offering, which they did previously. Then, that stock acquires value (sometimes at a discount to current market value because they are looking for one big money source to buy the stock, but that also devalues the existing stock price).
But if nobody is BUYING the stock and they still want to issue stock that has no value, then THEY must buy it themselves and THEN give the shareholders the stock dividend.
But (again) they do not have the cash to do that.
THERE. AIN'T. NO. FREE. LUNCH.
(No matter what the Reddit touts say.)
So ...
They are doing a STOCK SPLIT, and pretending it is a stock dividend. That is the only thing I see. It is weird.
And it is a bad time to do it -- in a bear market.
We'll see how it goes.
76 million x 3 = 228 million ... and why do you think that's a problem? They already know who all the shareholders are -- that is WHY they have an ex-dividend date. That is the date where the owners of RECORD are documented by the company, and THOSE owners get the dividend.
They KNOW who to pay the dividend to (if it is a dividend), or credit the split to (if it is a split). There is no mystery for the company.
No, they won't. The shorts are irrelevant -- except in the wet dreams of the Reddit boys.
Some of you guys seem to think that shorting a stock somehow means buying a stock.
WTF?
I read something from Reddit because I was trying to understand the argument, and it was just weird.
The person claimed that (a) someone owns GME, (b) someone else borrows GME, and then that means that (c) someone else also buys GME.
That (c) part is NOT true. Just (a) and (b).
In naked shorting, Mr. (b) shorts shares that Mr. (a) owns ... AND ... also shorts shares the nobody owns because they do not exist. That is WHY it is called "naked shorting." There is no extra buyer (Mr. (c)). If there was an extra buyer, and therefore more long shares that real shares (naked long, I guess) ... then THAT WOULD be a problem. But that is not how it works.
Seems like the Reddit boys don't really know WTF they are talking about.
If someone can explain it, I will take a listen ... but it seems like the Reddit boys are pushing a bunch of clusterfuck language and people accept it without understanding it.
And the company itself is acting very weird. Has been since the big short squeeze last year. I would not be surprised if the Reddit guy(s) are someone within or close to GME pushing this whole narrative.
Good luck, but I just don't see the story the same way some of you do.
Prove me wrong, and I will tip my hat to you.
Go post on Superstonk and they will prove you wrong in about 2 minutes.
Perhaps in the current scenario, ONLY shares that are owned by people outside of GME will be split, allowing them to sell some, or all, if they want, but not creating additional shares owned by the people "inside GME"? This would seem to fit with them calling it a "dividend" rather than a regular stock split. Is such a thing possible?
WTF does that mean?
No.
When you short a stock, you are borrowing it in exchange for an IOU. You are betting that it will go down, so that you can BUY the shares back and settle your short for a profit. If it goes up, you will eventually be forced to buy the shares at a loss in what's known as a margin call. That's where the buying in (c) is coming from.
Yes, I know how to short.
No, I was referring to a post on Reddit where some dumbass said there were twice the number of longs becuse of the shorts, and THAT is why he/she/it thinks the split/dividend will destroy the shorts.
Makes no sense, and I was pointing out that some people (at least) on Reddit are saying really stupid things.
Agreed.