[dee-list] 
| 1. | to delete from a list, as one that indicates acceptability, legitimacy, or the like. |
| 2. | to withdraw or remove (a security) from the group listed with a particular stock exchange. |
| de·list (dē-lĭst') tr.v. de·list·ed, de·list·ing, de·lists To remove from a list, especially from a list of securities that may be traded on a stock exchange: delisted the stock. |
delist
Case Study In early 2001, Nasdaq informed Drkoop.com, a one-time high-flying Internet company, that the firm's stock was subject to being delisted from the Nasdaq Stock Market. At the time of the notice Drkoop.com stock was trading at approximately 20¢ per share, well below the $1 per share required to continue trading on the Nasdaq. Delisting can have a serious negative impact on a firm's ability to raise equity capital, since it is likely to reduce liquidity and increase the bid-ask spread quoted by dealers. Many individual investors avoid buying a delisted stock as trading volume dries up. Negatives associated with delisting are likely to cause a major decline in the market price of a stock that most likely has already experienced a major price decline. Nasdaq, which delisted 240 companies in 2000, often begins the delisting process when a stock's bid price falls below $1 per share for 30 consecutive trading days. The firm subsequently has 90 calendar days to boost its stock price above $1 per share for 10 consecutive trading days. The New York Stock Exchange has a similar price requirement plus additional minimums regarding market capitalization and shareholder equity. |
