When a company such as Stratus Properties 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 STRS split history from start to finish, an original position size of 1000 shares would have turned into 500 today. Below, we examine the compound annual growth rate — CAGR for short — of an investment into Stratus Properties shares, starting with a $10,000 purchase of STRS, presented on a split-history-adjusted basis factoring in the complete STRS split history.

About Stratus Properties

Stratus Properties is a real estate company engaged primarily in the acquisition, entitlement, development, management, leasing and sale of multi-family and single-family residential real estate properties and commercial properties in the Austin, TX area and other select, fast-growing markets in Texas. Developed property sales can include an individual tract of land that has been developed and permitted for residential use, a developed lot with a residence already built on the lot. Co. has two operating segments: Real Estate Operations, which consists of its properties in Austin, TX and Leasing Operations, which comprises of Co.'s real estate assets, both residential and commercial. According to our STRS split history records, Stratus Properties has had 1 split.

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