It amazes me the amateurs who don't realize that
a stock split ally means NOTHING, NADA, NIL.
Someone on one of the other boards said "more shares
free".....uh, yeah with each share worth 50% less than it was
the day before.
People don't have to buy in
even lots of 100. You can by 100 or 225 or 78 or 12
shares of stock if you wish.
Splits do not
Sorry, you were wrong when you say a split means
nothing.... You obviously are interpreting the commentts in
an absolute value sense rather than an inherent
value. In that aspect I would agree, the 'free' comment
was simple....I do question YOUR 'amatuer' status
when you do not address 'cost of odd lots',
'liquidity', and 'shorting/liquidity issues'.... Rather than
retype what I have said before about the
'benefits'..here is an excerpt..(find it at any finacial info
Companies split their stock to make the price more
affordable to more investors. At a lower price, investors
can buy even lots of the stock and avoid the high
commissions attached to odd lot purchases. As a larger number
of investors buy the stock, demand increases and
thus a run-up in the stock price usually occurs. Also,
stock splits create liquidity as existing shareholders
find it easier to sell the stock when the price is
affordable to others.
The psychological effect the word
"split" has on investors is rather strong. Some investors
may automatically associate the word "split" with a
lower price and a "good buying opportunity." There does
seem to be a marketing hype to funds announcing a
split. It�s possible that fund companies are trying to
capitalize on investors� preconditioned favorable reaction
to stock splits.
Company Benefits: a company
will split its stock in order to make the price of
their stock more attractive (affordable) to investors
by, in effect, dropping the price of the stock. A
prospective purchaser of XYZ Company can now pick up a share
of stock for $50.00 post-split. The potential is for
more investors to begin buying the cheaper stock,
creating activity and momentum for the company. There is a
psychological aspect to lowering the price of a share in a
company through a split, especially one that is popular
or in a popular industry. Even though the actual
value of a share is halved through a split, the
impression to buyers is that they can now get a share of XYZ
for half the price. Depending on the company and its
industry, a share�s price can begin to rise right after a
split, and in many cases can, over time, go back to
where it was pre-split.
shareholders of XYZ Company now have twice the shares they did
before. Assuming the cheaper price entices new investors
to buy, the activity in the stock will naturally
cause the price to begin to rise. In the long run, as
XYZ Company does well and the value of XYZ stock
increases, then having more post split shares in your
portfolio will have a compounding effect on your entire
position in XYZ Company.
If you want to banter
about this, rather than fill up the AMRI baord..... My
email is NVR2LATE4@yahoo.com
Here's the detail of the
The Company's transfer agent on August 24, 2000 will
distribute the additional shares resulting from the stock
split. The Company currently has approximately 14.9
million shares outstanding. Upon completion of the split,
that number will increase to approximately 29.8
AMRI merged with Enzymed for
Here's the announcement from Yahoo
Albany Molecular sets 2-for-1 stock split
N.Y., Aug 7 (Reuters) - Chemistry research and
development firm Albany Molecular Research Inc.
(NasdaqNM:AMRI - news) on Monday said its board of directors
approved a 2-for-1 stock split on the company's common
The stock split, which will be paid out as a
dividend, entitles each shareholder to receive a stock
dividend of one additional share of Albany Molecular
The dividend will be paid on Aug.
24 to shareholders of record at the close of
business on Aug. 8.
The Albany, N.Y.-based company
also reported a 58 percent increase in its net income
for the second quarter to $5.9 million, or 38 cents a
share pre-stock split, from $3.7 million, or 25 cents
Revenues for the quarter rose 51
percent to $16.6 million from $11.0 million in the same
quarter last year. Shares of Albany Molecular rose 1-1/8
to close at 52-3/4 on the Nasdaq stock market.