BOSTON (TheStreet) -- Small-cap stocks, measured by the Russell 2000 Index, were little changed in April, trailing the broader market during a busy month of earnings releases from companies ranging from Apple (AAPL) to Ford (F) to Citigroup (C).
The underperformance of small-cap stocks is worrisome, given they inherently carry higher risks than their larger peers do. One of those is the inability to remain compliant with listing standards of the Nasdaq, spurring delisting warnings from the exchange.
Overall, April wasn't a banner month for equities, with the S&P 500 and Dow Jones Industrial Average up less than 1.5%. Google (GOOG), a major constituent of the S&P 500, dropped 11%. Meanwhile, many small-cap stocks, like Fuwei Films (FFHL), plummeted nearly 50%.
Some smaller companies, which typically expose investors to greater volatility, suffer from deficiencies ranging from violations of the minimum bid-price rule, as share prices of some penny stocks have languished below $1, to violations of board independence, delinquency and market value.Because companies on exchanges' watch lists record higher-than-average volatility, risk-friendly investors have the chance to make lots of money, either by shorting the stocks on expectations shares will fall, or going long on the hopes they will break through with surging revenue or profit growth. TeamStaff (TSTF), slapped with a delisting warning months ago, rallied 38% in April. On the other hand, Integra Bank (IBNK), also a recipient of a delisting notice a few months ago, tumbled more than 30% this month. The following 26 companies were notified in April that they're in violation of listing requirements and could be kicked off the Nasdaq. The companies now have a limited window of time to regain compliance with the exchange's listing rules.
First Community Bank Corp. of America (FCFL) Company Profile: First Community Bank provides banking services to small- and middle-market businesses and individuals in Florida. Current Share Price: 28 cents (April 26) Listing Violation: Market value of publicly held shares. The Nasdaq requires that First Community Bank maintain a minimum $1 million market value of publicly held shares for continued listing. In March, First Community Bank also received a delisting notice from the Nasdaq as the company's stock is below the minimum bid price requirement. Received Nasdaq Notice: April 1 Management's Expected Action: First Community Bank has until Sept. 28 to regain compliance with this listing standard. The company noted that Community Bank, also based in Florida, offered to buy First Community Bank in February for $10 million. The deal is expected to close in May. If the deal does not close, First Community Bank said it will take any action relating to either of the foregoing matters.
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