A:

When a ticker symbol changes it's usually not a good sign. Tickers of publicly traded companies generally only change for one of four reasons:

  1. The company has merged with another company.
  2. The company had a name change.
  3. The company has been delisted (indicated by symbols such as .PK, .OB or .OTCBB).
  4. The company has filed financial statements late or even gone bankrupt.

When a ticker symbol changes because of a merger, the company being acquired usually gives up its ticker symbol in favor of the acquiring company's symbol. Corporate actions such as mergers can often be positive for a company, especially if the company is taken over for a premium over the share price.

Sometimes, a ticker symbol changes because the company has changed its name. For example, when AOL Time Warner dropped the AOL and became simply Time Warner, it changed its symbol from AOL to TWX. A company name change generally doesn't mean much to its operations, though investors might interpret it as positive sign if it reflects a positive change in the company's overall strategy.

If a ticker symbol has had letters added to it such as .PK, .OB or .OTCBB, this means the stock has been de-listed and is no longer trading on the exchange on which you purchased it, but rather on the less liquid and more volatile over-the-counter market. More specifically, a .PK indicates that your stock is now trading on the pink sheets, while an .OB suffix or .OTCBB prefix represents the over-the-counter bulletin board.

A stock that has been de-listed is like a baseball player who has been sent from the major leagues to the minor leagues. For some reason, the stock is no longer worthy of trading on a major exchange like the New York Stock Exchange or Nasdaq, for example because it failed to maintain the exchange's requirements. (See also: What are the listing requirements for the Nasdaq?)

You may have also noticed that Nasdaq-listed securities have four or five characters. In this case, the fifth character often communicates a piece of information, and it can also mean something is wrong with the company. For example, if a "Q" has been added, this means that a company is in bankruptcy proceedings, and "E" means the company is late on its SEC filings. Below is a complete list of fifth symbols on the Nasdaq and what they mean:

A - Class A
B - Class B
C - Issuer qualifications exceptions
D - New
E - Delinquent in required filings with the SEC
F - Foreign
G - First convertible bond
H - Second convertible bond
I - Third convertible bond
J - Voting
K - Nonvoting
L - Miscellaneous situations, such as depositary receipts, stubs, additional warrants and units
M - Fourth class of preferred shares
N - Third class preferred of preferred shares
O - Second class preferred of preferred shares
P - First class preferred of preferred shares
Q - Bankruptcy proceedings
R - Rights
S - Shares of beneficial interest
T - With warrants or with rights
U - Units
VWhen issued and when distributed
W - Warrants
X - Mutual Fund
Y - ADR (American Depositary Receipt)
Z - Miscellaneous situations, such as depositary receipts, stubs, additional warrants and units

RELATED FAQS
  1. Do hedge funds have ticker symbols?

    Discover whether or not hedge funds have ticker symbols, where you can find ticker symbols and the significance of a ticker ... Read Answer >>
  2. What are the fifth-letter identifiers on the Nasdaq?

    In some cases, a ticker symbol on the Nasdaq will have five letters where the fifth letter is an identifier symbol. Read Answer >>
  3. Why do all mutual fund tickers have an X at the end?

    It's true that all mutual funds' tickers have an X at the end of their symbol. The reason for this is to distinguish between ... Read Answer >>
  4. What does it mean when a stock trades on the Pink Sheets or the OTCBB?

    The stocks of well-known companies such as General Electric and Microsoft trade on major exchanges such as the New York Stock ... Read Answer >>
  5. What do all of the letters in a stock option ticker symbol mean?

    The option ticker explains four main things about the option: the underlying stock, whether it is a call or a put option, ... Read Answer >>
Related Articles
  1. Investing

    Translating Ticker Talk

    Stock tickers can say a lot about a company in just a few letters. Find out how to read them.
  2. Trading

    Understanding The 2010 Options Symbology

    There is a wealth of information in the expanded option symbols, but they should make things easier for traders.
  3. Investing

    Understanding The Ticker Tape

    We explain the meaning and use of that reel of symbols whizzing across your TV or computer screen.
  4. Investing

    Understanding Off-Balance Sheet Financing

    For anyone who was invested in Enron, off-balance sheet (OBS) financing is a scary term. Off-balance sheet financing means a company does not include a liability on its balance sheet. It is an ...
  5. Investing

    Digging For Profitable Delistings

    Deregistration can provide opportunities for savvy investors. We'll show you how to cash in.
  6. Managing Wealth

    What You Need To Know About Preferred Stock

    Curious about preferred shares? Here's what you should know about these bond-like instruments.
  7. Investing

    Why Companies Delisted from Indexes Can Be a Buy (OI)

    Learn about a value-investing strategy that takes advantage of stocks that may represent a bargain when they're delisted from a benchmark index.
RELATED TERMS
  1. Hard-Coded Stock

    This is a term that refers to a company's stock symbol or ticker ...
  2. O

    A component of a stock symbol that indicates the shares of that ...
  3. Z

    A Nasdaq stock symbol specifying that the stock is a miscellaneous ...
  4. I

    A Nasdaq stock symbol specifying that it is the third preferred ...
  5. G

    A Nasdaq stock symbol specifying that it is the first preferred ...
  6. H

    A Nasdaq stock symbol specifying that it is the second preferred ...
Hot Definitions
  1. Investing

    The act of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit.
  2. Stagflation

    A condition of slow economic growth and relatively high unemployment - a time of stagnation - accompanied by a rise in prices, ...
  3. Notional Value

    The total value of a leveraged position's assets. This term is commonly used in the options, futures and currency markets ...
  4. Interest Expense

    The cost incurred by an entity for borrowed funds. Interest expense is a non-operating expense shown on the income statement. ...
  5. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
  6. Pro-Rata

    Used to describe a proportionate allocation. A method of assigning an amount to a fraction, according to its share of the ...
Trading Center