ATLANTA - Streamline Health Solutions, Inc. (NASDAQ:STRM), a provider of healthcare financial performance solutions, has announced a 1-for-15 reverse stock split of its outstanding common stock. The move, approved by the Board of Directors, follows authorization from stockholders at a special meeting on September 19, 2024. This action aims to ensure the company meets the minimum bid price for continued listing on The Nasdaq Capital Market.
The reverse stock split is scheduled to take effect at 12:01 a.m. Eastern Daylight Time on October 4, 2024. Streamline Health's common stock will begin trading on a post-split basis at market open on the same day under the new CUSIP number 86323X205, but will retain the trading symbol STRM.
At the time of the reverse stock split, every 15 shares of issued and outstanding common stock will be automatically converted into one share of common stock. Stockholders who would otherwise hold a fraction of a share will receive a cash payment instead, calculated based on the closing sales price of the common stock on the effective date of the reverse stock split.
The adjustment will also affect securities or rights convertible into common stock, with all references in related agreements, documents, and plans being updated accordingly. Equity awards outstanding immediately before the reverse stock split will be proportionately adjusted.
Computershare Inc., serving as the exchange agent for the reverse stock split, will handle the transition for shareholders. Those with shares in electronic book-entry form do not need to take any action, while those holding shares through banks, brokers, or other nominees will see their positions automatically adjusted and will receive cash payments for fractional shares as per the respective processes of their bank, broker, or nominee.
For further details about the reverse stock split, stakeholders can refer to the definitive proxy statement filed with the Securities and Exchange Commission on August 19, 2024. This article is based on a press release statement from Streamline Health Solutions, Inc.
In other recent news, Streamline Health Solutions Inc. reported a total revenue of $4.5 million for the second quarter, marking a decrease from the $5.8 million recorded in the same period of the previous year. The company also reported a net loss of $2.8 million for Q2 2024. Despite a churn leading to non-renewals totaling $2.8 million in SaaS Annual Contract Value (ACV), the company cited a 21% growth in pro forma SaaS revenue for the first half of fiscal 2024.
In addition, Streamline Health Solutions Inc. has approved a reverse stock split, to be executed at a ratio determined by the Board of Directors, following a Special Meeting of Stockholders. This move aims to adjust the number of shares in circulation, without affecting the company's market capitalization. The proposal for the reverse stock split was supported by approximately 81% of the outstanding shares of common stock.
Looking ahead, the company anticipates a revenue decline of $300,000 in Q3 2024 but expects recovery to $4.5 million in Q4. For fiscal 2025, a significant revenue growth along with improved cash flow is projected. As part of its strategic priorities, Streamline Health Solutions plans to strengthen the Oracle (NYSE:ORCL) partnership, develop new channel partnerships, and maximize upsells and cross-sells within the existing client base.
InvestingPro Insights
In light of Streamline Health Solutions, Inc.'s (NASDAQ:STRM) recent announcement of a 1-for-15 reverse stock split, it is crucial to consider the company's financial health and market performance. According to InvestingPro data, Streamline Health Solutions has a market capitalization of $14.38 million, reflecting its size within the industry. However, the company's P/E ratio stands at -0.68, indicating that investors are currently valuing the company at less than its net earnings, which could be a sign of market skepticism regarding its profitability.
Moreover, Streamline Health Solutions has experienced a significant revenue decline of 15.64% over the last twelve months as of Q2 2025, which aligns with the analysts' anticipation of a sales decline in the current year, as noted in one of the InvestingPro Tips. Additionally, the company's stock price has been highly volatile, with a substantial drop of over 70% in the past year, which may raise concerns among investors about the stock's stability and future prospects.
InvestingPro Tips highlight that Streamline Health Solutions is quickly burning through cash and operates with a significant debt burden. These factors, combined with the company's inability to generate profit over the last twelve months and the prediction that it will not be profitable this year, present a challenging financial landscape for the company. It's worth noting that there are 13 additional InvestingPro Tips available for Streamline Health Solutions, which can provide investors with a more comprehensive understanding of the company's financial position and future outlook.
The reverse stock split decision appears to be a strategic move to maintain compliance with Nasdaq's listing requirements, but investors would be well-advised to consider the company's broader financial context. For those interested in a deeper analysis, further insights and tips are available on InvestingPro's dedicated page for Streamline Health Solutions.
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