Are there any tax implications for shareholders resulting from the share consolidation?

Tax perspective

A share‑consolidation (reverse split) is treated as a capital‑structure event, not a disposition of shares. For U.S. shareholders it does not create a taxable event at the time of the 80‑for‑1 consolidation, so no capital‑gain or loss is recognized on the day of the split. The shareholder’s original cost basis is simply divided by the same 80‑to‑1 factor and carried forward to the new, higher‑priced shares; the total basis and holding period remain unchanged. The only practical tax‑related consideration is to ensure the adjusted basis is correctly reported on future filings, especially if the shareholder later sells the post‑split shares.

Market and trading implications

The consolidation will reduce the float dramatically and push the per‑share price upward roughly 80‑fold, which can attract short‑term technical interest. The price‑adjusted chart will retain the same historical trend, but the new higher price level may trigger a psychological breakout as the stock moves into a round‑number zone (e.g., from $0.30 to around $2.40). Expect a short‑term liquidity squeeze and modest volatility spikes around the August 18 effective date, especially if the market perceives the move as a “clean‑up” of a low‑priced, high‑share‑count structure.

Actionable insight

From a trading standpoint, the split itself is neutral on fundamentals—Chanson’s earnings, cash‑flow and growth prospects remain unchanged. However, the higher post‑split price can make the stock more attractive to institutional buyers who avoid sub‑$1‑per‑share equities, potentially providing a mid‑term upside catalyst. Consider positioning ahead of the effective date with a modest long‑bias (e.g., buying on a pull‑back after the initial volatility) while keeping a tight stop just below the pre‑split support level (adjusted for the 80‑to‑1 factor). Monitor volume and any price‑dislocation on the first trading day; a clean breakout with sustained volume may signal the start of a short‑to‑medium‑term rally. No immediate tax cost to shareholders, but maintain accurate basis records for future disposals.