CMGI Inc. (CMGI) has just become eligible under the “10 under $10” with yesterday’s drop to $9.97. The shares are slightly above $10 today
The company just recently began trading without the “D” as CMGID after its reverse stock split. Wall St. is still cautious as the main operations of the company are in the ModusLink “supply chain” business. It doesn’t take a rocket scientist to be cautious about any aspect of logistics in a slowing economy when transports have remained quite negative.
Stocks that go through reverse stock splits often have a contrary impact from what they intended: lower share prices, mainly from short sellers. Investors seem inclined to stay on the sidelines a bit longer with CMGI, even if this is technically back under $1.00 based on the pre-reverse-split share prices.
The reports earnings on December 3, and caution seems to dictate against jumping in ahead of what will be a tough quarter to please even cult stock investors.
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