Calculate share consolidation values by finding old share price, new share price, or share counts when three of four inputs are known.
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Consolidation Of Shares Formula
A share consolidation, also called a reverse stock split, reduces the number of shares and increases the price per share in the same proportion. The total market value is intended to stay the same before fees, taxes, rounding, and market price changes.
Rearranged formulas used by the calculator:
- OSP = old share price before consolidation
- ONS = number of old shares before consolidation
- NSP = new share price after consolidation
- NNS = number of new shares after consolidation
To use the calculator, enter any three values and leave the fourth blank. If you leave the new share price blank, it calculates the post-consolidation price. If you leave the old share price blank, it works backward to the pre-consolidation price. If you leave either share count blank, it calculates the missing number of shares using the same total value equation.
Common Share Consolidation Ratios
The table below shows how common consolidation ratios affect share count and share price, assuming the total value does not change.
| Consolidation Ratio | Meaning | Effect on Share Count | Effect on Share Price |
|---|---|---|---|
| 1-for-2 | 2 old shares become 1 new share | Halved | Doubled |
| 1-for-5 | 5 old shares become 1 new share | Divided by 5 | Multiplied by 5 |
| 1-for-10 | 10 old shares become 1 new share | Divided by 10 | Multiplied by 10 |
| 1-for-20 | 20 old shares become 1 new share | Divided by 20 | Multiplied by 20 |
Example
Example 1: Calculate the new share price
You own 1,000 old shares priced at $0.80 each. After consolidation, you will have 200 new shares.
The new share price is $4.00.
Example 2: Calculate the number of new shares
You have 5,000 old shares priced at $0.25 each. The new share price after consolidation is $2.50.
The number of new shares is 500.
FAQ
Does a share consolidation change the value of your investment?
Not by itself. A consolidation changes the number of shares and the price per share, but the total value is intended to remain the same. For example, 1,000 shares at $1.00 have the same value as 100 shares at $10.00. In both cases, the position is worth $1,000 before any fees, taxes, rounding adjustments, or market price movement.
What happens if the consolidation creates a fractional share?
If the ratio does not divide evenly into your old share count, you may end up with a fractional share. The company or broker may round the result, pay cash in lieu of the fraction, or handle it according to the consolidation terms. The calculator gives the mathematical result, so check the official terms for the actual treatment of fractional shares.
Why did the market price differ from the calculated new share price?
The calculated price is the theoretical price based on the consolidation ratio and total value. Once trading resumes, the market price can move because of buying and selling, news, liquidity, and investor reaction. The formula shows the mechanical adjustment, not a guaranteed trading price.