Apple just announced a stock split — here’s what that means for investors


During its third quarter earnings results on Thursday Apple said that the company’s Board of Directors approved a four-for-one stock split.

Stock splits are cosmetic, meaning they do not change anything about a company’s underlying fundamentals. They can lead to renewed interest from smaller investors by making the shares — which are now cheaper — more accessible. But that interest would not be enough to influence the share price more so than larger investors already freely trading the stock.

In this case, all investors who currently own the stock will receive three additional shares after the market closes on August 24. With Apple’s shares trading around $400 in the after hours, the new price for holders will be around $100 when it begins trading on a split-adjusted basis on August 31.

Apple’s move is not uncommon, and the company has enacted stock splits in the past. The tech giant’s most recent split came in 2014, which enabled it for consideration and ultimately addition to the Dow Jones Industrial Average. 

The 30-stock index is price-weighted, meaning that the impact of a company’s…

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