The Apple Split
Here’s the rub—- ALL THINGS ARE NOT EQUAL. While it is true that Apple share-owners will own seven times as many shares at 1/7th the value the day after the split culminates, the ensuing performance of stock splits shows they out perform. Various studies of stocks, splitting a minimum of two-to-one, point to an out-performance over the following one, two and three year periods.
This is no guarantee of future market beating numbers for Apple, but it is indicative of a management which feels confident that the stock will act well over the coming time. The last thing Apple wants to deal with is a cascading stock price following the split. We at Fagan Associates always take note when companies raise dividends or split their stock, viewing these actions as strong votes of confidence by management.
Please note that all data is for general information purposes only and not meant as specific recommendations. The opinions of the authors are not a recommendation to buy or sell the stock, bond market or any security contained therein. Securities contain risks and fluctuations in principal will occur. Please research any investment thoroughly prior to committing money or consult with your financial advisor. Please note that Fagan Associates, Inc. or related persons buy or sell for itself securities that it also recommends to clients. Consult with your financial advisor prior to making any changes to your portfolio. To contact Fagan Associates, Please call 518-279-1044.