WALTHAM, Mass. - Markforged Holding Corporation (NYSE:MKFG), a company known for its industrial 3D printing technology, has announced a 1-for-10 reverse stock split of its Common Stock, scheduled to take effect at the start of trading on September 19, 2024. This strategic move, approved by the Board of Directors, aims to comply with the New York Stock Exchange's minimum bid price requirement for continued listing.
The decision follows a stockholder vote on June 18, 2024, which authorized the Board to implement a reverse stock split at a ratio of their choosing, within the range of 1-for-5 to 1-for-10. The chosen 1-for-10 ratio will convert every ten existing shares of Common Stock into one new share. As a result, the total number of outstanding shares will decrease from approximately 203 million to about 20.3 million, subject to rounding for fractional shares, which will not be issued. Instead, stockholders will receive whole shares post-split.
The company's Common Stock will maintain its NYSE trading symbol "MKFG" but will be assigned a new CUSIP number, 57064N201. Adjustments will also be made to Markforged's equity incentive plans, including the number of shares available for issuance and the terms of outstanding stock options, restricted stock units, and other equity securities. Warrants will be modified according to their terms, with ten warrants becoming exercisable for one share of Common Stock at an exercise price of $115.00 per share.
Furthermore, the authorized shares of Common Stock for issuance will be reduced from 1 billion to 100 million. Continental Stock Transfer & Trust Company is managing the exchange process for the reverse stock split. Stockholders holding shares in book-entry form will receive a transaction statement reflecting their post-split share ownership, and no action is required on their part. Those holding shares through banks, brokers, or other nominees will have their positions automatically adjusted, although they are encouraged to contact their respective entities for specific processing details.
This announcement is based on a press release statement, and additional information regarding the reverse stock split can be found in the Company's definitive proxy statement filed with the SEC on April 26, 2024.
Markforged emphasizes its commitment to enabling resilient and flexible manufacturing with its Digital Forge platform, which facilitates on-demand industrial production through 3D printing. The company's global presence spans over 70 countries with more than 10,000 customers.
In other recent news, Markforged Holding Corporation disclosed its Q2 2024 financial results, showing a decrease in revenue from $25.4 million to $21.7 million year-over-year. Despite this, the company's gross margins improved to 51.9%, and operating expenses were reduced to $23.3 million. Markforged also announced a $25 million cost reduction initiative, primarily targeting R&D expenses. The company managed to ship its first PX100 and accelerated shipments of its FX10 product, with plans for further expansion in the second half of the year. However, Markforged faces legal challenges from Continuous Composites that could lead to a 5 to 7 percentage point reduction in gross margins. Despite these challenges, the company projects full-year revenues between $90 million and $95 million. These are recent developments that have implications for the company's future performance.
InvestingPro Insights
In light of Markforged Holding Corporation's (NYSE:MKFG) recent announcement regarding a reverse stock split, investors may be considering the financial health and market performance of the company. According to InvestingPro data, Markforged has a market capitalization of approximately $41.06 million, reflecting the company's current valuation within the industry. Notably, the company holds an impressive gross profit margin of 48.42% as of the last twelve months leading up to Q2 2024, indicating a strong ability to generate profit from its sales revenue.
However, the company's revenue has experienced a decline, with a -17.17% change over the last twelve months as of Q2 2024. This could be a point of concern for investors as it may reflect challenges in maintaining growth or market share. Additionally, the company's stock has seen significant price volatility, with a one-week total return of -12.55% and a one-year total return of -82.15%, suggesting that investor confidence has been shaken recently.
InvestingPro Tips provide further insights into the company's financial position and market performance. Markforged is currently trading at a low Price / Book multiple of 0.36, which could indicate that the stock is undervalued relative to its assets. Moreover, the company is highlighted for holding more cash than debt on its balance sheet, which is a positive sign of financial stability. However, it is important to note that analysts do not anticipate the company will be profitable this year, and the stock has taken a significant hit over various time frames, including the last week, three months, and six months.
For investors seeking a comprehensive view of Markforged's financial metrics and market performance, there are additional InvestingPro Tips available. By visiting https://www.investing.com/pro/MKFG, investors can access a total of 18 InvestingPro Tips, offering a deeper analysis that could inform investment decisions.
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