Starting Monday, Amazon will execute the 20-for-1 stock split it announced back in March. The stock, which closed Friday at $2,447 will open Monday at about $122 as each share splits into 20 shares. That will mean Amazon’s share count, which had been 509 million will jump to 10.2 billion.
The split could be beneficial to the stock, even though technically each shareholder’s stock in the company will be worth the same amount. To start with, individual shares will become more affordable for new smaller investors to purchase, potentially widening the pool of potential shareholders. The split will also allow Amazon to be included in the Dow Jones Industrial Average, without the potential swings a percentage change in an expensive stock would produce in the weighted average.
This will be Amazon’s fourth stock split since it went public in 1997. However it has been more than 20 years since the last one. The other three all occurred in rapid succession during the weighty days of the dot-com bubble of the late nineties.
Next up will be Google’s 20-for-1 split scheduled for mid-July, potentially followed by Tesla and Gamestop, which have indicated splits would be forthcoming, but have not set official dates yet.