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As the downward stock spiral continues in the telecommunications field, two more Philadelphiaarea companies face possible delisting from the Nasdaq National Market if they don't boost their share prices soon.
While delistings aren't new to local telecoms, Conshohocken-based UbiquiTel Inc., a wireless service concern and Sprint PCS partner; and Bala Cynwyd-based Pegasus Communications Corp., a satellite TV company; are larger and in far better financial shape than the half-dozen companies that were delisted last year.
UbiquiTel dipped under $1 on June 6, when it fell to 91 cents and now trades around 60 cents a share. Pegasus fell to 98 cents on June 13, but spiked to $1.14 on July 10 before returning to the 80-cent range.
Since the start of the year, Pegasus has lost more than $600 million in market value, while UbiquiTel is down more than $430 million.
Trading below $1 for 30 straight days is the first step toward being kicked off the Nasdaq. If a company's shares don't rise above that threshold, Nasdaq starts the delisting process. Stocks that trade below $1 send institutional investors packing and spark investor fears that their shares will plummet to sparsely traded exchanges.
Prior to delisting, a company can salvage its listing in a Nasdaq hearing if it can show a plan, such as a reverse split, to boost its stock price, said Alan Singer, a former Securities and Exchange Commission lawyer and partner with Morgan, Lewis & Bockius in Philadelphia.
"With the inflated prices of the...