Taronis Technologies (NASDAQ: TRNX) looks to be having a strong day on some charts, with gains of more than 300%. However, these charts have not yet updated for the reverse stock split that took place today. The reality is that the stock is down more than 6% this morning.
Nonetheless, with positive news released on the same day the reverse becomes effective, declines are being minimized and there is plenty to look forward to ahead. Here’s what’s going on:
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TRNX Stock Tumbles On Reverse Split
Before we get into the news that Taronis Technologies released with regard to its Water Pilot subsidiary, let’s talk a bit about why the stock is down this morning.
Late last week, the company said that it would be moving forward with a 1-for-5 reverse stock split. This reverse split took effect in the stock today.
While reverse splits are more cosmetic than value changes, the reality is that they tend to lead to fear among investors. After all, in the case of TRNX, the reason for the split was to maintain its listing on the NASDAQ as it saw no other option to bring its stock up to meet the minimum bid requirement on the exchange of $1 per share.
However, there’s a silver lining here. As a result of the reverse split, the stock is now trading well over the minimum price requirement, so liquidity provided through the listing on the NASDAQ will remain.
It’s also worth mentioning that larger investors tend to shy away from stocks that trade with a price of $1 per share or lower. So, the arger price point offered up through the reverse split may attract new investors.
In Other News
The reverse split isn’t the only reason that TRNX is hitting the news this morning. In a press release issued early this morning, the comapny announced that its subsidiary, Water Pilot, won a new paid installation with a leading Florida property management firm.
According to the release, The company will work on Water Pilot valve installation at a 22 story luxury condominium, located in Miami.
IN a statement, Scott Mahoney, CEO at TRNX, had the following to offer:
We are seeing real momentum with our sales team at the Water Pilot. Our Florida based sales team is executing extremely well. This client has the potential to scale rapidly, as we are working with one of the leading property managers in Florida for this install.
The accelerated adoption rates we are experiencing in Florida is making it easier to attract additional sales members to our team and open up new markets. We are now looking to expand our team in California, the southwest, and much of the water restricted mid-west. We believe our technology provides clear financial savings with the potential to preserve 650 billion gallons of fresh water every day.
Putting It All Together
While a reverse split is a concern, it’s also a necessary evil in this case. However, looking forward, things are looking up in a big way. In particular, Taronis Technologies’ Water Pilot subsidiary is doing great.
Recently, the company announced that it successfully found a water leak at a Holiday Inn Franchise. Of course, the repair of this leak will save the franchise owner quite a bit of money, further validating the value of the Water Pilot technology and ensuring that a happy customer will likely expand its contract to other franchised hotels.
This, combined with today’s news shows that Water Pilot is really starting to take off here.
It’s also worth mentioning that TRNX recently had a win when it comes to their water treatment technologies. Let’s not forget that just a few short weeks ago, the company announced that it greatly reduced the amount of cianobacteria in a Florida lake during a blue green algae bloom.
While the company is spinning off its Taronis Fuels unit, it will be handing out shares to this unit on a 1 for 1 basis to shareholders of TRNX in November.
All in all, TRNX continues to fire on all cylinders, only further adding value for investors!
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I’m confused since I’m new. Can we trade current shares without worry of losing out on the spin-off?
No, if you trade the shares now, you will not get the dividend shares from the spin off.