CorVel Announces Effectiveness of Three-For-One Forward Stock Split

Rhea-AI Summary

CorVel (NASDAQ: CRVL) has announced the effectiveness of a three-for-one forward stock split, effective December 24, 2024. The company has filed an amendment to its Fourth Amended and Restated Certificate of Incorporation with Delaware's Secretary of State to implement the split and increase its authorized shares proportionately.

Every share of common stock outstanding or held in treasury as of December 23, 2024 (record date) will be split into three shares. Additional shares distribution is expected on December 24, 2024, with post-split trading beginning at market open on December 26, 2024.

Positive

• Stock split increases share liquidity and makes shares more accessible to retail investors
• No dilution of shareholder value as proportional ownership remains unchanged

Negative

• None.

Insights

Financial Markets Specialist

This stock split marks a strategic move for CorVel, effectively tripling the number of outstanding shares while maintaining the same market capitalization. The 3-for-1 split will reduce the per-share price to approximately one-third of its pre-split value, potentially enhancing trading liquidity and making shares more accessible to retail investors.

The timing of this split, scheduled to take effect during the holiday period with post-split trading beginning December 26, 2024, is particularly interesting. With CRVL's current market cap of $5.78 billion, this move suggests management's confidence in the company's valuation and future growth prospects. Stock splits typically signal management's optimism about sustained high share prices and often lead to increased retail investor participation.

Mechanically, shareholders will receive two additional shares for each share held on the December 23, 2024 record date. While the split doesn't change the fundamental value of holdings, historical patterns show that splits often correlate with positive market sentiment and improved trading dynamics. The increased share count and lower price point could attract a broader investor base and potentially reduce bid-ask spreads.

Corporate Finance Analyst

The execution of this forward stock split demonstrates sophisticated capital markets management by CorVel's leadership. By increasing the float while maintaining proportional ownership, the company is effectively optimizing its share structure for improved market dynamics. The concurrent increase in authorized shares provides strategic flexibility for future corporate actions.

A simplified explanation for retail investors: Imagine having a $100 bill and exchanging it for three $33.33 bills - the total value remains the same, but the smaller denominations make transactions easier. Similarly, this split makes CRVL shares more accessible without changing the company's underlying value.

The Delaware filing aspect is particularly noteworthy as it reflects proper corporate governance and compliance with regulatory requirements. The clean execution timeline, with immediate effectiveness on December 24 and trading implementation on December 26, minimizes market disruption and provides clarity for stakeholders.

FORT WORTH, Texas, Dec. 24, 2024 (GLOBE NEWSWIRE) -- CorVel Corporation (NASDAQ: CRVL) today announced the effectiveness of a three-for-one forward stock split, along with a proportionate increase in the number of authorized shares of its common stock to accommodate the stock split.

The Company filed an amendment to its Fourth Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the stock split and proportionate increase in the number of authorized shares of its common stock. The amendment will be effective on December 24, 2024.

As a result of the stock split, every one share of common stock outstanding or held in treasury on December 23, 2024, the record date for the stock split, was split into three shares of common stock. The additional shares of common stock are expected to be distributed on December 24, 2024.

Trading is expected to begin on a post-stock split adjusted basis at market open on December 26, 2024.

Cautionary Note Regarding Forward-Looking Statements

This Press Release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, which statements are subject to considerable risks and uncertainties. Forward-looking statements include all statements other than statements of historical fact contained in this Press Release, including statements regarding the timing of the distribution of the additional shares and the timing of trading on a post-stock split basis. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results to differ materially and adversely from those expressed, assumed, or implied by the forward-looking statements. Some of the risks and uncertainties that may cause actual results to materially differ from those expressed or implied by these forward-looking statements are described in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024, as well as in our Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission. Any forward-looking statement made in this press release is based only on information currently available to the Company and speaks only as of the date on which it is made. Except as required by applicable law or the listing rules of the Nasdaq Global Select Market, the Company expressly disclaims any intent or obligation to update any forward-looking statements, or to update the reasons actual results could differ materially from those expressed or implied by these forward-looking statements, whether to conform such statements to actual results or changes in expectations, or as a result of the availability of new information.

CorVel Corporation

5128 Apache Plume Road

Suite 400

Fort Worth, TX 76109

Contact: Melissa Storan

Phone: 949-851-1473

www.corvel.com

FAQ

What is the ratio of CorVel's (CRVL) stock split announced on December 24, 2024?

CorVel announced a three-for-one forward stock split, meaning each existing share will be split into three shares.

When will CRVL's stock split shares be distributed to shareholders?

The additional shares from the stock split are expected to be distributed on December 24, 2024.

What is the record date for CorVel's (CRVL) stock split?

The record date for CorVel's stock split is December 23, 2024.

When will CRVL begin trading on a post-split basis?

Trading on a post-stock split adjusted basis is expected to begin at market open on December 26, 2024.

Does CorVel's stock split affect shareholder ownership percentage?

No, the stock split does not affect shareholders' proportional ownership as it simply divides existing shares into smaller units.