Zhongchao Inc. (NASDAQ:ZCMD) experienced a dramatic surge in after-hours trading on Thursday, with shares skyrocketing 209% to $3.43, following a series of corporate actions including a reverse stock split and shareholder approval to dramatically increase authorized capital. The stock had closed the regular session at $1.11, down 0.89%.
The Shanghai-based healthcare information and patient-services company has been navigating a turbulent period on the Nasdaq, with three reverse splits executed in 2026 alone, resulting in a combined 1-for-744 ratio for pre-split shareholders. The latest consolidation, a 1-for-3 split effective June 29, reduced Class A shares to approximately 1,149,825 from 3,449,475.
Shareholder Vote and Capital Raise
At a June 18 shareholder meeting, investors approved a proposal to raise authorized share capital to $10 billion from $20 million, a 500-fold increase. The vote saw 20,176,066 shares in favor, with only 31,766 against and 3,007 abstentions. Notably, just 70,000 ordinary shares out of 3,469,636 eligible voted, representing a turnout of about 2.0%.
The meeting also authorized the board to implement one or more share consolidations over three years, with ratios ranging from 2:1 to 250:1. The company acted swiftly, announcing the 1-for-3 split on June 25, effective June 29.
Market Context and Trading Activity
Thursday's after-hours surge comes ahead of the Independence Day holiday, with Nasdaq closed on Friday. The sustainability of the move remains uncertain, as after-hours trading can be volatile and may not reflect regular session demand. Volume figures are also in question, with StockAnalysis reporting 224,313 shares traded, while Google Finance and Benzinga listed 23.99 million shares, implying turnover roughly 21 times the post-split Class A share count.
Despite the spike, the after-hours price of $3.43 values the Class A equity at approximately $3.9 million, still below the $5 million gross proceeds targeted in a best-efforts public offering announced in late May.
Reverse Split History and Compliance
The company's reverse split history underscores its efforts to maintain Nasdaq listing requirements. A 1-for-8 split in March was aimed at meeting the minimum bid price rule, while subsequent consolidations on June 8 (1-for-31) and June 29 (1-for-3) were to retain its Capital Market listing. The cumulative effect for shareholders since before March 2026 is a 1-for-744 consolidation.
Investors should closely monitor next week's trading to see if the after-hours rally holds during regular Nasdaq hours. The stock's low float and high volatility present both opportunities and risks.
