Following the April 2nd spin off of new Dow (DOW) - Get Dow Inc. Report , the company's Materials division, DowDuPont undefined (i.e., RemainCo) announced that, pending shareholder approval, the company would seek to perform a reverse stock split.
While this may be unattractive to individual retail investors, a demographic that can be highly sensitive to the dollar value of a share, institutional investors love reverse splits. As Zev Fima, Research Analyst for ActionAlertsPLUS, points out, "Institutions pay commission on a per share basis (a flat fee per share, say $0.10 per share, not a percentage of the share price). So, the less shares they have to buy, because they're paying more per share, the less they pay in commissions. By making shares more 'institution friendly' the company can play to the larger shareholders such as mutual funds, which tend to be a less emotionally driven and therefore stable investor base."
As for retail investors the reason this negatively impacts them is because it makes it harder for them to initiate a position over multiple buys; With a larger share price retail investors will have less of an opportunity to average down their cost basis. As Jim Cramer points out in Rule 3 of his 25 Rules for Investing, "Never buy all at once. Never sell all at once. Stage your buys. Work your orders. Try to get the best price over time."
Investors must also be aware that on June 1st, 2019 DowDuPont shares will be reduced once again following the break up of Corteva Agriscience, the company's agricultural business and DuPont, the specially products division, making the reverse stock split somewhat preemptive in nature.