Russolillo reports, “In a research note published this afternoon, Laurence Balter, an analyst at Oracle Investment Research, advocated for a split… ‘Mathematically it does nothing except make for a low price. Valuation-wise it’s neutral. Financially, it saves the company from having to dole out billions it needs to fend off its competition from ever getting a stranglehold. More importantly, however, psychologically it’s everything. The average retail shareholder will be attracted to a reachable and cheaper share price, as retail is not an insignificant owner. The downside to this plan is negligible and can be fully reversed if it doesn’t do the trick. Apple can continue to increase its dividends at a comfortable rate and buybacks can continue at the board’s discretion.’”
Russolillo reports, “Apple shares reversed earlier losses as the rumor gained traction on trading desks. Shares recently traded up more 1.5% at $449.32.”
Read more in the full article here.
Doug Kass: Apple to announce stock split on Wednesday – February 26, 2013