VirnetX (NASDAQ: VHC) stock is down 62% premarket. That sounds like a terrible blow to shareholders there. But we can also describe this as a 6 cent, or perhaps a 10%, rise in the VHC stock price. It's really up to us which description we want to use. Those who owned VirnetX yesterday would probably describe it as a rise.
The big issue for VHC just recently has been the patent case against Apple. That was won in some rounds but Apple were just able to reverse that verdict. In the patent courts VHC had prevailed and there was a possible $500 million and change award that might, at some date, be collected from Apple. That was reversed in the Federal courts and this is something that is becoming a feature of the American legal system. The Federal - that is, perhaps the real and actual - courts are becoming much less favourable to patent holders than the patent courts below them. This is - for the good of the countNASDAQry and economy - probably a good thing but it's of little comfort to patent holders looking for their payout.
VirnetX stock price from NASDAQ
But leaving aside that issue, VirnetX had also declared a special dividend. “Payable April 17; for shareholders of record April 10; ex-div April 7.” Well, yes, it went ex-div back a bit. But not all of the tickers nor market prices were changed to reflect that at the time. The payment was in fact yesterday, so the effect of that $1 a share is showing up in the nominal price this morning.
Which is how we can think of that Schroedinger's Prie, both up and down at the same time. For while there was a dollar paid out that nominal price has only fallen by 94 cents. Or, to put that the other way around, add the $ back in and the price has risen by 6 cents. Sometimes these things happen, it's not really and wholly possible to insist that either price is correct. Yes, the value of VHC stock is now that lower number - but the value of it to stockholders as of yesterday isn't.
