When Apple announced as part of its latest earnings report that it would split its stock four ways as of the end of August, the company said the stock split was meant to make the shares more "accessible" to investors.
Stock splits, which have become increasingly rare, at least in the tech industry, are "something that a lot of companies probably should do pretty regularly," according to Nasdaq Chief Economist Phil Mackintosh.
With a stock like Apple, which has quadrupled in price since the last time it was split in 2014, a split does indeed broaden the company's potential investor base, Mackintosh said. The move doesn't change the inherent market capitalization of the company — it simply makes it cheaper for investors to get a piece — particularly the retail investors and day traders who have been flooding the online trading platforms like Robinhood.
At $100 or so, which is roughly the price of a single share of Apple after a four-way split at its current price, "it's probably the perfect stock price" for Apple, Mackintosh said. The split will make the trading spreads tighter, which he said is likely to keep intraday volatility down and help the price continue to go up.
Still, as Mackintosh noted, retail investors should look at stock splits as a way to build positions in companies with strong fundamentals that might have otherwise been out of reach; they should not change the calculus about whether the stock itself is a good investment.
President Donald Trump says a deal struck by Netflix last week to buy Warner Bros. Discovery “could be a problem” because of the size of the combined market share. The Republican president says he will be involved in the decision about whether federal regulators should approve the deal. Trump commented Sunday when he was asked about the deal as he walked the red carpet at the Kennedy Center Honors. The $72 billion deal would bring together two of the biggest players in television and film and potentially reshape the entertainment industry.
Disney's changes to a program for disabled visitors are facing challenges in federal court and through a shareholder proposal. The Disability Access Service program, which allows disabled visitors to skip long lines, was overhauled last year. Disney now mostly limits the program to those with developmental disabilities like autism who have difficulty waiting in lines. The changes have sparked criticism from some disability advocates. A shareholder proposal submitted by disability advocates calls for an independent review of Disney's disability policies. Disney plans to block this proposal, claiming it's misleading. It's the latest struggle by Disney to accommodate disabled visitors while stopping past abuses by some theme park guests.
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