Stock splits have enjoyed a renaissance in recent years, thanks in part to higher corporate profits and soaring stock prices. It’s worth noting that while the practice was widespread in the late 1990s, it had fallen by the wayside before finding its way back into the limelight. Companies generally choose this path after years or even decades of robust financial and operating results have driven the stock price out of reach of average investors.
While a stock split doesn’t change the underlying fundamentals of the business, it does make the stock more affordable for everyday investors and employees. This is a factor frequently cited by company managements as the catalyst for the…
