Stock dividends (not to be confused with cash dividends) do the same thing as a stock split.
If you get a 5% stock dividend, you get 5 new shares for every 100 you own. Which is no different than a 105/100 stock split. So both give you more shares but don't affect your percentage of ownership in the corporation. That's why to most investors the terms "stock dividend" and "stock split" mean the same thing.
There's some legal distinction, I believe. As I recall, stock dividends come out of retained earnings. Which isn't relevant to most investors. But I believe it's one reason that stock dividends aren't very common, and are small when done. So you'll see a lot of 2 for 1 stock splits, but not many 100% stock dividends.
And the cash dividend per share usually remains the same after a stock dividend. If it does, the net effect of a 5% stock dividend is nothing in terms of value of the shares you own -- but it increases the cash dividend payout you receive by 5%. Which is good.