Tesla and Apple set stock splits to lower share prices — then they rallied
Tesla pumped 30% since revealing its stock split, while Apple is up 24%
Are Tesla and Apple buyersreallyjust here for the stock splits?
The thing is, it’s difficult to say just how many buyers either company has attracted simply through the promise of increased share counts.
[Read: Watch Tesla’s meteoric rise — set to techno-remixed Elon Musk tweets]
Revenue, profits, and other boring (but necessary) factors could just as likely have had positive effects on Apple and Tesla’s share prices.
Apple even disclosed its stock splitinsideits stronger-than-anticipated quarterly earnings call, making it even harder to tell.
For what it’s worth, the brainiacs over atColumbia Universityinvestigated the suspected link between stock splits and share price a few years ago, but found little connection.
Instead, they found that analysts tend to increase their earnings expectations around the time that stock splits are announced, which leads to more interest from investors.
In any case, Columbia’s research hasn’t stopped analyst speculation as to which major company will be next to split their stock.
Amazon is one likely candidate. The ecommerce giant hasn’t issued a stock split since 1999—beforethe dot-com bubble burst — during which time its share price has risen from $60 to $3,182.
Story byDavid Canellis
David is a tech journalist who loves old-school adventure games, techno and the Beastie Boys. He’s currently on the finance beat.David is a tech journalist who loves old-school adventure games, techno and the Beastie Boys. He’s currently on the finance beat.
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