Understanding reverse split https://www.investopedia.com/terms/r/reversesplit.asp KEY TAKEAWAYS A reverse stock split consolidates the number of existing shares of stock held by shareholders into fewer, proportionally more valuable, shares. A reverse stock split does not directly impact a company's value.It does, however, often signal a company in distress since it raises the value of otherwise low-priced shares. Remaining relevant and avoiding being delisted are the most common reasons for corporations to pursue this strategy