MoviePass parent Helios and Matheson Analytics plummets further on plans for another reverse stock split

Shares of Helios and Matheson Analytics Inc (NASDAQ:HMNY) took another nosedive after MoviePass’s beleaguered parent revealed plans for a second reverse stock split in a regulatory filing.  

The struggling company’s board will propose a reverse stock split in a ratio of up to 1 share for 500 shares at a shareholders’ meeting on October 18, according to the statement provided to the Securities and Exchange Commission.

Read: MoviePass parent Helios and Matheson shares plummet after revealing service outage due to cash problems

In response to the revelation, shares dipped 29.4% to US$0.015 in Monday’s afternoon trading session.

Last July, in its initial attempt to push up its flagging share price, the company orchestrated a reverse stock split, which gave investors 1 share for every 250 owned.

The first stock split set a temporary fire under Helios and Matheson’s shares, pushing them up above US$22, but the stock has been plunging ever since.

Read: MoviePass owner’s shares jump after unveiling new business plan

In a bid to shore up its ailing fortunes, Helios and Matheson recently introduced a new business plan that allows subscribers in the popular MoviePass program to see up to three movies per month for US$9.95 and also receive a US$5 discount for any movie tickets beyond the first three.

Monthly subscribers, who can still cancel anytime, will have the chance to take part in the new plan when they renew their membership. And annual subscribers will not be forced to adopt the new plan until their contracts are renewed.

The new business model for MoviePass comes in the wake of a cash crisis for Helios and Matheson and the cratering of its share price.

Earlier this year, the company disclosed in an SEC filing that it was burning through as much as US$20mln in cash per month on average.

Story by ProactiveInvestors