What just happened? Google parent company Alphabet has announced a 20-for-1 stock split scheduled to go into effect this summer. If given the green light, each shareholder will receive a dividend of 19 additional shares of the same class stock they held at the close of business on July 1, 2022, to be awarded on July 15.
The split, which has already been approved by the Board of Directors, will impact the company's class A, class B and class C stock, and is subject to shareholder approval.
Should it come to fruition, it would be only the second time that Google has conducted a stock split. The company executed a two-for-one split in 2014 that created the class C stock with no voting power.
Google restructured under the Alphabet corporate umbrella in 2015 and its share value has continued to swell. At the close of business yesterday, a single Alphabet share was worth $2,752.88. At such a high price, it becomes prohibitive for some investors to purchase entire shares rather than smaller fractions. A 20-for-1 split would bring the cost down to just $137.64 per share, making it much more attractive to casual investors or those just starting to build a portfolio.
Share value in Alphabet is up more than eight percent on the news, trading at $2,975 as of this writing.
Image credit: Kai Wenzel, Ahmer Kalam