RE:RE:Trying to understand impact of SOBO Spinoff on TRPnedstar71 wrote: Galove wrote: I have combed through piles of posts and material and cannot find the price placed on SOBO stock once it is spun out from TRP. I get the fact that for every 1,000 shares of TRP equates to 200 shares of SOBO. I did a bunch of calculations last week and expect TRP stock to fall back to $48 - $51 price range. Given the current price of SOBO is hanging around $30 per shares I am wondering if TRP will open around $31 - $34 on 2 October. Makes no sense for TRP to fall to this price, but who knows. The other scenario I tell myself is SOBO will drop to $12 - $14 range.
I experienced a few buyouts and spinoffs in the last couple of years and the final settlement price was above to buyout price
Thoughts comments appreciated.
No. I've been as confused as anyone about this but here is where I'd say you're messing up.
If you are getting 0.2 shares of SOBO for every 1 share of TRP that means there should be only 1/5 the number of SOBO shares as there are TRP shares so you can't say the share prices carry equal weight when determining what TRP will trade at.
SOBO is currently trading at $30 (for easier math]. So per share value of SOBO out of TRP is 30÷5 or about $6 PER TRP share.
Same with the dividend of SOBO being potentially 69 cents monthly. Divide .69 by 5 equalling approx 14 cents per month off TRP's current dividend
Sorry that last calculation was way off even by the wonky back of the napkin math I was using, aside from it also not being a monthly dividend lol
But considering SOBO's dividend is forecast to be $2.75 a year, theoretically that should represent removing approximately 55 cents (2.75÷5) out of TRP's annual dividend payment from what I can see.