Apple’s stock has split five times since the company went public. The stock split on a 4-for-1 basis on August 28, 2020, a 7-for-1 basis on June 9, 2014, and split on a 2-for-1 basis on February 28, 2005, June 21, 2000, and June 16, 1987.
In each of the five times that Apple has split its stock, it was undergoing strong growth in sales and profitability, save for the split in the year 2000, when sales dipped between the dot-com bust and the release of the iPod in October 2001.
It has been over four years since Apple’s last stock split. In the last two splits, the company appears to have intended to bring the share price down to about $100. With a current price now finally having cracked the $250 barrier, and setting new all-time highs, Apple’s Board of Directors may be considering another stock split.
Companies issue stock splits for a variety of reasons, but one motivation is to make their shares more accessible to a wider range of investors. Stock splits increase the number of shares outstanding and reduce the price per share, which makes the stock more affordable for smaller investors.
While fractional share purchases are widely available today, they were not always an option. In the past, investors had to buy whole shares, which meant that high-priced stocks were out of reach for many people. Stock splits were a way for companies to lower the price per share and make their stock more accessible to a broader range of investors.
In addition to making their shares more affordable, companies may also issue stock splits to increase liquidity in their stock. By increasing the number of shares outstanding, the trading volume in the stock can increase, which can make it easier for investors to buy and sell shares. Trading volume is not an issue for Apple, the world’s most valuable company.
Stock splits can also be a signal to the market that a company is doing well. When a company announces a stock split, it can be interpreted as a positive sign that the company’s management is confident about the future prospects of the business.
Finally and importantly, Apple is a major component of the Dow Jones index, which is widely used as a benchmark for U.S. equities. Because the Dow is price-weighted, Apple has a significant weight in the Dow. This means that even small changes in Apple’s stock price can have a large impact on the Dow. This can distort the performance of the Dow and make it less accurate as a measure of the overall market. As a result, there is pressure on Apple to periodically split its stock, which would reduce its weighting in the Dow index and increase the Dow’s accuracy in reflecting the overall market.
Apple is currently 12th out of the 30 companies that comprise the Dow Jones Industrial Average with a weight of around 3.67. Goldman Sachs is No.1 in Dow weighting at 8.25.
So, if weighting and trading volume were the only triggers for a split, Apple is not likely to do so. Still, the company could split its stock at any time simply as a signal of managements’ confidence in the company’s future.
MacDailyNews Note: So, while fractional share purchases are now widely available, as we’ve just seen with Nvidia’s 10-for-1 split, companies still issue stock splits to make their shares more accessible to smaller investors, increase liquidity, signal confidence in the future of the business, and, importantly, reduce their price weighting in the widely used Dow Jones index.
Please help support MacDailyNews. Click or tap here to support our independent tech blog. Thank you!
Support MacDailyNews at no extra cost to you by using this link to shop at Amazon.
Many people working at Apple participate in the Apple Employee Stock Purchase Plan. By doing a stock split, those employees will be able to buy more shares of Apple stock, which will be more valuable in the future and could possibly split again in the future as well.
Honestly, though, I don’t know anyone who has ever purchased a fractional share. The markets are still driven emotionally, so I cannot image a psychological being wanting to own 1/3 of a $250 share. For the same reason, most unautomated share purchases are usually in lots ending in zeros. Do you want to own 99 shares of a company or 100?
Even Warren Buffet acknowledges this with Class B shares (still on the pricey side for less wealthy retail investors).
I’d like to see COST (Costco) split soon, as $1000/share seems counterintuitive for a place that used to call itself “Price Club.” 😅
AAPL might consider a 2-for-1 split next year, but I don’t hear the clamor for that yet. Fine with me either way.
Apple has a clear history of splitting its stock during periods of strong performance, often when the share price climbs well above \$100. With the stock now breaking past the \$250 mark and hitting new all-time highs, it’s reasonable to wonder if another split is on the horizon. Historically, splits have made shares more accessible to a wider range of investors, and given Apple’s consistent growth, a split could be a strategic move to maintain investor enthusiasm.
Stock splits are a waste of time because most stock exchanges now allow trading of fractional shares. Apple has zero incentive to attract low-value investors and has long been buying back its own stock (which signals its pivot from a growth to a value stock) so that it doesn’t have to pay out to the investors who already hold AAPL. If you’re looking for a hot growth stock, go overseas to high growth regions. Go look where NVIDIA manufactures its products.
By the way, the current value of AAPL is ~ $202, which is approximately 22% down from the all time high. The record valuation of Apple occurred in 2024 when the USA had a government that respected global trade and understood why global manufacturing is mutually beneficial. AAPL will not reach its former valuation until the USA deposes its dictator wannabe or restores all its economic and foreign relation policies back to those of ANY prior administration of ANY party of the last 90 years or so. Alas, in 2025 the hoodwinked electorate placed another Hoover in the White House and so we know what direction the global economy is going for the next few years.
Globalism is NOT the answer. We finally have an administration that is putting America first just as it should be.