When a company such as SDLP 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 SDLP split history from start to finish, an original position size of 1000 shares would have turned into 100 today. Below, we examine the compound annual growth rate — CAGR for short — of an investment into SDLP shares, starting with a $10,000 purchase of SDLP, presented on a split-history-adjusted basis factoring in the complete SDLP split history.

About SDLP

Seadrill Partners is engaged in owning, operating and acquiring offshore drilling units. Co.'s drilling units are under long-term contracts with major oil companies such as Chevron, Total, BP, ExxonMobil and Tullow. Offshore drillings units are categorized in four rigs: jack-up rigs which are mobile, self-elevating drilling platforms equipped with legs that are lowered to the ocean floor; tender rigs conduct production drilling from fixed or floating platforms; semi-submersible rigs operate in a "semi-submerged" floating position; and drillship which are self-propelled ships equipped for drilling in deepwater. According to our SDLP split history records, SDLP has had 1 split.

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