Up 725% in 10 Years: Why This Could Be Wall Street's Next Big Stock Split
All of the factors align for this company to split its shares, but it's a buy no matter what.
Some might argue a stock split is merely cosmetic. Existing owners still own the same percentage of the company they did before the split and the business continues to operate just as it had before. The only difference is new buyers can now buy even smaller portions of the business, and shareholders can sell off smaller portions.
But a stock split, which usually comes after a prolonged period of gains in the stock price, can provide a useful signal from management. If management expects the price to continue climbing higher, it's more likely to split the stock. If it thought the stock was overvalued, it might hold off. As a result, stock prices seem to move higher when management announces a stock split.
In that case, it's best to buy a stock ahead of management's decision. And one stock, up 725% in the last decade, is a great buy at its current price whether management decides to split its shares or not.
