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CELEBRATION, Fla. - La Rosa Holdings Corp. (NASDAQ:LRHC), a micro-cap real estate company with a market capitalization of $7.37 million, announced Wednesday it will implement an 80-for-1 reverse stock split effective July 7, 2025, at 12:01 a.m. Eastern Time. According to InvestingPro data, the stock has declined 85% year-to-date.
The real estate and PropTech company’s common stock will continue trading on Nasdaq under the symbol LRHC but will begin trading on a split-adjusted basis when markets open on July 7. The reverse split will reduce the number of outstanding common shares from approximately 58.3 million to about 729,000. InvestingPro analysis reveals concerning financial health metrics, with a weak overall score of 1.01 and a current ratio of just 0.06.
No fractional shares will be issued in the split, with any fractional entitlements rounded up to the next whole number at the participant level. The company’s common stock will trade under a new CUSIP number: 50172T202.
According to the press release statement, the company aims to regain compliance with Nasdaq’s minimum bid price requirement through this action. CEO Joe La Rosa stated the move could potentially attract a broader range of institutional and long-term investors by reducing the public float. The company faces significant challenges, with InvestingPro highlighting several risk factors including weak gross profit margins of 8.57% and substantial cash burn (subscribers can access 12 additional ProTips).
La Rosa Holdings, which operates 26 corporate-owned brokerage offices across six states and Puerto Rico, provides real estate agents with flexible compensation options including revenue-sharing models and fee-based structures with 100% commission.
The company also indicated it is shifting focus toward achieving profitability and generating positive cash flow, with a goal of reaching positive financial performance by the end of 2025.
In other recent news, La Rosa Holdings Corp. has amended the terms of a senior secured convertible note originally issued in February 2025. The amendment addresses errors in the note’s maturity date and alternate conversion price, with the original principal amount set at $5.5 million. Additionally, the company has entered a non-binding Letter of Intent with MiiX Financial Holdings Trust to integrate residential financing solutions, potentially enhancing access to homeownership. However, La Rosa Holdings faces a Nasdaq delisting notice due to negative stockholders’ equity, reporting a deficit of $(83,377,044) as of March 31, 2025. The company has until July 14, 2025, to submit a plan to regain compliance. Furthermore, La Rosa Holdings has switched its independent registered accounting firm from Marcum LLP to CBIZ CPAs, following Marcum’s resignation. This change in auditors comes amid concerns over material weaknesses in internal control over financial reporting. These developments reflect La Rosa Holdings’ ongoing efforts to address financial and operational challenges.
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