When a company such as LEI conducts a reverse share split, it is usually because shares have fallen to a lower per-share pricepoint than the company would like. This can be important because, for example, certain types of mutual funds might have a limit governing which stocks they may buy, based upon per-share price. The $5 and $10 pricepoints tend to be important in this regard. Stock exchanges also tend to look at per-share price, setting a lower limit for listing eligibility. So when a company does a reverse split, it is looking mathematically at the market capitalization before and after the reverse split takes place, and concluding that if the market capitilization remains stable, the reduced share count should result in a higher price per share.

Looking at the LEI split history from start to finish, an original position size of 1000 shares would have turned into 40 today. Below, we examine the compound annual growth rate — CAGR for short — of an investment into LEI shares, starting with a $10,000 purchase of LEI, presented on a split-history-adjusted basis factoring in the complete LEI split history.

About LEI

Lucas Energy is an independent oil and natural gas company. Co. is engaged in the acquisition and development of crude oil and natural gas from a range of productive geological formations, including the Austin Chalk and Eagle Ford formations, primarily in Gonzales, Wilson and Karnes Counties, south of the city of San Antonio, TX. At Mar 31 2016, Co.'s total estimated proved reserves were 4.3 million barrels oil equivalents, of which 3.8 million barrels were crude oil reserves, and 2.50 billion cubic feet were natural gas reserves. According to our LEI split history records, LEI has had 1 split.

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