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Digital title and closing provider Doma is the latest real estate technology company to conduct a reverse stock split in hopes of delisting from the New York Stock Exchange after it saw its share price fall below the $1 minimum last summer.

Shares of Doma, which traded at just 17 cents on Monday, climbed above $5 on Friday after every 25 shares of the company’s outstanding common stock were converted into a single share overnight. Home will be back in the stock market’s good graces if its share price remains above $1 for the next 30 trading days.

The reverse split of shares in the ratio of 1:25 was unanimously approved by the company’s board of directors, Doma reported. notification. Shareholders had previously allowed the board of directors will conduct a 1-for-10 to 1-for-50 reverse split at the company’s annual meeting on June 8.

New York Stock Exchange warned Doma in Augustafter the company’s share price fell below $1, that the company would no longer be eligible to trade on the stock exchange unless the stock climbed back above that threshold within six months.

Although a share buyback generally affects all shareholders uniformly and does not change the proportion of their share in the company, it can have an impact on investor sentiment.

Doma share price after reverse split

Source: Yahoo Finance

While Doma’s stock price touched a high of $5.43 in afternoon trading following the reverse split, it gave up some of those gains to close at $4.94. After adjusting for the impact of the reverse split, shareholders saw a decline in the value of their shares in the company in June. At Doma’s closing price of 30 cents on June 1, 25 shares of Doma would now be worth $7.50.

Shares in troubled iBuyer Offerpad have performed well since the company made a 1 for 15 reverse stock split June 13 to keep the company on the New York Stock Exchange. Offers in Offerpad they are up 70 percent since the reverse split, climbing from $7.82 to over $13, with much of that gain realized in the past week.

While companies that are delisted from the New York Stock Exchange or other exchanges can still be traded as “pink” over-the-counter (OTC) listings, investors tend to have more confidence in companies that trade on major exchanges.

“If the NYSE were to delist the common stock for any reason, it would adversely affect our reputation and, as a result, our business, and would likely reduce the liquidity and market price of our common stock,” Doma’s board of directors said. shareholders approve a reverse stock split. A delisting would also likely make it harder for Doma to raise money and give stock incentives to employees, investors say he said in April.

Founded in 2016, Doma has developed a machine learning platform, Doma Intelligence, and other technology to automate third-party title and escrow processes.

After raising less than expected when it entered the stock exchange in 2021 through a merger with a special purpose acquisition company (SPAC) Doma saw a rise in mortgage rates last year reduce dramatically the volume of mortgage refinancing of its clients.

As Doma adapts its mortgage-buying technology, it continues to post losses, with a loss of $42.1 million in the first quarter adding to a cumulative deficit of $536.9 million through March 31.

Last month, Doma announced that she did sold 22 retail titles and operations centers in California to the title of insurer Williston Financial Group (WFG). Doma said it will receive up to $24.5 million for the sale of those Northern and Central California assets, plus $14 million in additional revenue over the next year, “based on the retention of specific employees.”

In three rounds of layoffs last year, Doma cut its workforce by 52 percent, eliminating 1,076 positions companywide and ending the year with 1,062 employees.

Doma founder and CEO Max Simkoff said on the May 9 earnings call that the company reduced its branch footprint by 13 percent during the first quarter as it completed a “transformative core strategy for the business” to leverage the company’s instant underwriting technology through external partnerships.

Editor’s note: This story was updated after publication to record Doma stock’s closing price of $4.94 on Friday, June 30.

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