SMX (Security Matters) (NASDAQ: SMX) stock should jump 2.200% at the open. SMX stock will not, sadly, be enhancing the value of the corporation by doing so, this is a purely nominal price move. Something that is, of course, a pity, given the 99% value destruction since the flotation. In fact, 99% value destruction since February. Which is, I think we can all agree, pretty good as an example of losing money for stockholders. The SPAC merger was, after all, only at the end of Jan this year. Maybe there’s a reason some prefer to look at stocks that have gone through the full IPO process? Rather than the short cut of merging into a shell?
As to what’s done here: “SMX (Security Matters) Public Limited Company engages in the development and commercialization of track and trace technologies for various industries in Australia. It owns and commercializes technology to mark various objects, such as solid, liquid, or gas allowing identification, circularity, proof of authenticity, tracking supply chain movements, and quality assurance. The company’s technology comprises a chemical-based hidden barcode system,” That doesn’t sound like something inherently silly, not something that couldn’t be made to work. That they’re not actually making it work seems to be indicated by the stock price, but it’s one of those things that could work.
We’ve looked before at SMX (Security Matters): “One thing that riles markets is when people complain about short selling. Yes, of course, that shorting might be an affront to hopes and dreams and all that but is it just part of a stock market. Complaining about it just makes those doing the complaining look as if they're concentrated upon that stock price rather than actually running the company. Even illegal short selling - so called “naked” - is just one of those things that's going to happen out there.” The company has been expending a great deal of effort complaining about short selling. Even to the point to lawyering up to try to sue people. We generally take this to be evidence of management not concentrating upon what they’re supposed to be doing - running the company.
SMX (Security Matters) stock price from Google Finance
The net effect of that stock price collapse is that the company is now in breach of NASDAQ listing rules. The US markets think penny stocks are disreputable, therefore you cannot be a penny stock and remain on the main markets. The solution is simple enough, simply have a reverse stock split: “SMX (Security Matters) Public Limited Company (SMX) will effect a one-for-twenty-two (1-22) reverse split and par value change of its Class A Ordinary Shares. The reverse stock split and par value change from US .0001 to US .0022 will become effective on Monday, August 21, 2023.”
The point here though is that this is a purely nominal price change. Doesn’t make back all that money lost by the stockholders - sadly.