AppleOf (NASDAQ: AAPL) Common shares are going to be quite cheap, but not because they are tanking. With the release of its third quarter financial results on Thursday, the tech giant announced that it would split that stock into 4-for-1.
The company’s board of directors approved the move, which will take effect on August 31. As of August 24, Apple investors of record will be given three additional shares for each share held by them on that date.
The company did not specify a reason or reason for the split. Publicly traded companies take such a step because their stock has become relatively expensive on a per-share basis; Theoretically, lower prices may attract more budget-challenged investors. Apple’s stock was trading at $ 384.76 a share at the time of market closing on Thursday.
It is important to note that outright splits do not change the underlying value of a share. The total market capitalization remains the same; It is spread over a large number of stocks.
This is not the first time Apple has cleaved its shares, although this is not exactly a habit for the high-flying company. It split 2-for-1 three times in June 1987, June 2000 and February 2005, and 7-for-1 split in June 2014.
It has been a busy week for the company. On the day Q3 results were unveiled and the split was announced, CEO Tim Cook asked members of the House Judiciary Committee at times in a remote hearing on the business practices of the tech industry. Were also being grilled FacebookMark Zuckerberg, Amazon.Com Chief Jeff Bezos, and Google parent CEO Sundar Pichai Alphabet.