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Apple Stock Jumps on Rumors of Stock Split at Tomorrow's Shareholder Meeting

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Original poster
Apr 12, 2001
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Hedge fund manager Doug Kass tweeted (via 9to5Mac) a short time ago that he is hearing rumors of an announcement regarding a stock split coming at Apple's shareholder meeting scheduled for tomorrow at the company's headquarters in Cupertino, California. The stock has reversed course since Kass's Tweet, moving from down $5 to up $5.

Many observers, such as Fortune's Philip Elmer-Dewitt, are calling into question Kass's statements, noting the sequence of events that saw him announce a large position in Apple, float the rumor of a stock split, and then announce that he was selling off shares after the stock spiked. Kass has, however, defended his Tweet, saying that the rumors were "all over the Street".

aapl_split_rumor.jpg
While a stock split would not add any intrinsic value to Apple's market value, some have viewed a potential split as a positive for Apple under the perception that a company is more likely to split when it is confident that the stock price will rise in the future. Observers have also argued that high stock prices for companies like Apple and Google have kept them from being added to the Dow Jones Industrial Average given the outsized impact they would have on the price-weighted index.

Apple's last stock split came in February 2005, a 2-for-1 move that brought the price of a single share down to just under $45. Apple has refrained from splitting its stock since that time, with investors seeing the share price rise to over $700 before pulling back to the current level around $450.

Article Link: Apple Stock Jumps on Rumors of Stock Split at Tomorrow's Shareholder Meeting
 
Article Link
https://www.macrumors.com/2013/02/26/apple-stock-jumps-on-rumors-of-stock-split-at-tomorrows-shareholder-meeting/
R

Ralf The Dog

macrumors regular
May 1, 2008
192
0
Many investors only invest in units of 100. Apple's high price locks many investors out. If Apple's stock price is halved, I can see many small investors jumping in. Many less sophisticated investors who do not look at the P/E or PEG but only look at Apple's price will stop thinking it is overvalued.

Volatility should go up, as small investors are more likely to buy and sell over purchasing and holding for years.
 
725032

725032

Guest
Aug 5, 2012
724
0
Ive said it before and i'll say it again.

Buy 100+ or dont bother at all.

So glad i sold out when i did.

Stock splits always bring the wrong kind of investors in to the mix.
 
DipDog3

DipDog3

macrumors 65816
Sep 20, 2002
1,191
812
1. Buy a lot of AAPL shares at a low price.
2. Tweet about a stock split rumor.
3. AAPL's price goes up.
4. Sell shares & PROFIT!!!!

Why didn't I think of that???
 
M

mrhick01

macrumors 6502
Sep 22, 2008
486
316
ThatsMeRight said:
I have found that this is a good explanation about a stock split. It's quite interesting.
Click to expand...

It is a useful explanation, but it does seem like stock manipulation nevertheless.

I am disturbed over what the stock market has seemed to become over the last 20 or so years. Admittedly, my knowledge is rudimentary, only having researched enough over the years to be "investment club"-level savvy. It seems like the overall increase of the market is less about the strength, fundamentals and future of corporations, but merely how they can puff up their numbers for short-term gain. It appears to operate more like a casino and less like an exchange that exists to support American corporate financial strength.
 
M

mrhick01

macrumors 6502
Sep 22, 2008
486
316
Peace said:
Some people can't afford $450-$700 a share as an investment.

$200-$300 is more reachable for those wanting to invest and don't have a lot of money.

The last I heard Apple was a publicly traded company.
Click to expand...

To your first sentence, I thought that is what investment clubs and mutual funds are for, to help those without the capital to do it themselves have an opportunity to invest in higher-priced stocks that have growth potential.
 
Squilly

Squilly

macrumors 68020
Nov 17, 2012
2,260
4
PA
I'm almost all for the idea, except for the fact that it'll take longer to hit $1000, which everyone wants.
 
R

Ralf The Dog

macrumors regular
May 1, 2008
192
0
d0mth0ma5 said:
How is that not stock price manipulation?
Click to expand...

Everything a company does manipulates the price of a stock. The question is, are the changes predatory or are they beneficial.

When a company announces a new product, it could be considered manipulation of stock price. It is also quite legal. When a company hires or fires members of the board of directors, it is quite often with the intent of improving stock prices.

When a company splits it's stock, it is usually because, their price is so high, many who wish to invest, can't. By splitting, they are lowering an artificial barrier to entry. This is generally a good thing.
 
Peace

Peace

Cancelled
Apr 1, 2005
19,546
4,556
Space The Only Frontier
mrhick01 said:
To your first sentence, I thought that is what investment clubs and mutual funds are for, to help those without the capital to do it themselves have an opportunity to invest in higher-priced stocks that have growth potential.
Click to expand...

That's probably true for most people but I like to control where my money goes without using a middleman.
 
basesloaded190

basesloaded190

macrumors 68030
Oct 16, 2007
2,693
5
Wisconsin
mrhick01 said:
To your first sentence, I thought that is what investment clubs and mutual funds are for, to help those without the capital to do it themselves have an opportunity to invest in higher-priced stocks that have growth potential.
Click to expand...

You will never get the same return with a mutual fund that might hold a few shares of a stock compared to completely owning shares

----------
Ralf The Dog said:
Everything a company does manipulates the price of a stock. The question is, are the changes predatory or are they beneficial.

When a company announces a new product, it could be considered manipulation of stock price. It is also quite legal. When a company hires or fires members of the board of directors, it is quite often with the intent of improving stock prices.

When a company splits it's stock, it is usually because, their price is so high, many who wish to invest, can't. By splitting, they are lowering an artificial barrier to entry. This is generally a good thing.
Click to expand...

But Apples hasn't said anything about this. Right now it is just some guy telling everyone what he thinks. That's the whole point!
 
T

theOtherGeoff

macrumors regular
Jun 18, 2010
189
0
DipDog3 said:
1. Buy a lot of AAPL shares at a low price.
2. Tweet about a stock split rumor.
3. AAPL's price goes up.
4. Sell shares & PROFIT!!!!

Why didn't I think of that???
Click to expand...

Because
a)you (or your trading floor friend) don't have a lower (near zero cost) cost of trade

b)you don't feel the need to sell your inhouse pile of apple stock you thought you'd be moving in 30-60 days a month ago when the price cratered and you bought.

c) you don't have 100s of thousands clients who will pay up to $30/trade for 20-200 shares of 'the action'

d)these same clients will sell in a few weeks months if apple doesn't move.

e) therefore you had no need to drive a couple million in easy profits into your plus column before quarterly bonuses are locked in.
 
M

m2nal

macrumors newbie
May 14, 2009
25
7
ha!

Douglas Kass ‏@DougKass
Apple continues to climb - now up by over $8. I continue to pare back as the rumor seems to be baseless based on current share authorization
 
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