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

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Feb 26, 2013.

  1. macrumors bot

    MacRumors

    Joined:
    Apr 12, 2001
    #1
    [​IMG]


    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".

    [​IMG]
    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
     
  2. macrumors P6

    Peace

    Joined:
    Apr 1, 2005
    Location:
    Space--The ONLY Frontier
    #2
    If they split it I'm buying it.
     
  3. macrumors member

    Joined:
    Jul 26, 2008
    #3
    How is that not stock price manipulation?
     
  4. macrumors 6502

    Joined:
    Nov 1, 2012
    Location:
    Halifax
    #4
    I want a piece of the apple.
     
  5. macrumors 68020

    Joined:
    Sep 12, 2009
    #5
    I have found that this is a good explanation about a stock split. It's quite interesting.
     
  6. macrumors regular

    Joined:
    May 1, 2008
    #6
    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.
     
  7. Guest

    725032

    Joined:
    Aug 5, 2012
    #7
    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.
     
  8. macrumors 68030

    basesloaded190

    Joined:
    Oct 16, 2007
    Location:
    Wisconsin
    #8
    That's not what he means. This guy claiming a split is happening could be just trying to get the price to shoot up and sell quick to make a lot of money.
     
  9. macrumors regular

    Joined:
    Feb 16, 2011
    #9
    In that case I'll sell you 4 quarters for a dollar. All day long. LET'S DO THIS.
     
  10. macrumors 6502a

    DipDog3

    Joined:
    Sep 20, 2002
    #10
    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???
     
  11. macrumors member

    Joined:
    Jul 26, 2008
    #11
    I was referring to Kass rather than Apple.
     
  12. macrumors P6

    Peace

    Joined:
    Apr 1, 2005
    Location:
    Space--The ONLY Frontier
    #12
    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.
     
  13. macrumors regular

    Joined:
    Sep 22, 2008
    #13
    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.
     
  14. macrumors 68030

    basesloaded190

    Joined:
    Oct 16, 2007
    Location:
    Wisconsin
    #14
    Not sure why/what you quoted me for :confused:
     
  15. macrumors 65816

    lunaoso

    Joined:
    Sep 22, 2012
    Location:
    New England, USA
    #15
    He would have to buy the stocks now for that analogy to make sense. If he buys them after the split, he gets them at a cheaper price.
     
  16. macrumors P6

    Peace

    Joined:
    Apr 1, 2005
    Location:
    Space--The ONLY Frontier
    #16
    A mistake. sorry.
     
  17. macrumors regular

    Joined:
    Sep 22, 2008
    #17
    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.
     
  18. macrumors 68030

    Joined:
    Oct 21, 2012
    #18
    Erm... +$7 isn't really a "jump". Unless you measure using limp kangaroos.
     
  19. macrumors 68020

    Squilly

    Joined:
    Nov 17, 2012
    Location:
    PA
    #19
    I'm almost all for the idea, except for the fact that it'll take longer to hit $1000, which everyone wants.
     
  20. macrumors regular

    Joined:
    May 1, 2008
    #20
    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.
     
  21. macrumors G5

    Joined:
    Jun 22, 2009
    #21
    In addition - the market is up today. And Apple has easily had quick downturns and upturns in any given day.
     
  22. macrumors P6

    Peace

    Joined:
    Apr 1, 2005
    Location:
    Space--The ONLY Frontier
    #22
    That's probably true for most people but I like to control where my money goes without using a middleman.
     
  23. macrumors 68030

    basesloaded190

    Joined:
    Oct 16, 2007
    Location:
    Wisconsin
    #23
    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

    ----------

    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!
     
  24. macrumors regular

    Joined:
    Jun 18, 2010
    #24
    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.
     
  25. macrumors newbie

    Joined:
    May 14, 2009
    #25
    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
     

Share This Page