Will Apple Split Its Stock In 2014?

logo 4/23/2014 UPDATE: Apple has just announced a 7 to 1 stock split for shareholders who own the stock as of June 2, 2014. I was right and the stock is up $40 in after hours trading!

As an Apple shareholder, I wish Apple would split its stock. Most stock splits are two to one but I would like a five to one or ten to one split even more I know that stock splits are mostly meaningless (except in Google’s case where investors now have to figure out whether they want to buy the GOOG or GOOGL stock symbol) and you technically have the exact same thing after a split as you did before the split. But in Apple’s case, a split would get you a stock that a lot more individual investors could afford. Apple has been trading in a $500 to $550 range for many months and as the most talked about stock in the universe, I’m sure a lot of people wish they could own it. But at such a high price they are deterred from buying because the stock is just too expensive. 

I Like To Buy Stock Shares In Lots Of 100

Personally, when I decide to buy a stock I prefer to buy at least 100 shares if I can. There is no reason for that other than it keeps things simpler to remember when all my stock buys are in increments of 100. When I bought Apple stock for my $150,000 portfolio though, I decided I should only buy 50 shares because I didn’t want too much of one stock in that account.  I’m sure other people are the same way: they don’t like buying one or two shares of a company and would rather buy lots of 10, 20, 50, or 100 shares if they can simply because it looks and sounds better. If Apple were to split its stock, it would bring the stock price down to a more affordable level for a greater number of individual investors who right now wish they could buy it but just can’t or won’t at a $500+ price.

Split Apple Stock To Make Investors Happy

A lot has been written about what is wrong with Apple and why the stock has not performed as well as the rest of the market. Most investors are discouraged that the company has so much cash and they want more of it to be unlocked. Raising the dividend is one way to return that money (and will probably happen in two weeks when earnings are announced) and buybacks are another way but they are a topic of much debate as many investors feel that buybacks have to be done at opportune times to really provide value.   So what else can be done to get the stock moving up again? An Apple stock split would open the door for more investors to buy the stock. Making the stock price lower would enable more retail investors to buy Apple for their individual portfolios. Apple may not be targeting market share with its product line and be content to sell only to the top tier customers and that is okay because they are obviously doing very well. But that same strategy is NOT a good one for their stock price and they should split the shares soon to make it so that everyone can afford to buy into this great company!

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