Google "what is Apple's Market Cap" and you will know the answer.
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
That's not true - Apple split many times before it went public. The value of the share without any splits would be the value of the company.
And no, Apple's stock price would be no different without splits (your $2400) than with splits.
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
You realize that none of the money spent when buying a share goes to the company, right? Once a company goes public, all shares are sold and bought by third parties, the company has no gain or loss as a result, except of course when it issues new shares (a secondary offering).
That's not true - Apple split many times before it went public. The value of the share without any splits would be the value of the company.
And no, Apple's stock price would be no different without splits (your $2400) than with splits.
I didn't say the stock value would change. I asked if it would have any effect on anything ... would $2400 a share (pick any massively high number simply as a discussion point) change any dynamics what so ever? Team B's reasoning says it would, Team A's says it wouldn't. I was wondering if an extreme case might make you see the obvious.
Every time Apple achieves something I remember Michael Dell and his advice to Apple when he said Apple should reimburse the money to the stock holders.
Ironic eh?
Apple 300.76
Dell 14.06
hehehe
Better to show the valuation and/or profits. Stock price or number of shares on their own are ambiguous.
Quote:
Originally Posted by digitalclips
I didn't say the stock value would change. I asked if it would have any effect on anything ... would $2400 a share (pick any massively high number simply as a discussion point) change any dynamics what so ever? Team B's reasoning says it would, Team A's says it wouldn't. I was wondering if an extreme case might make you see the obvious.
Without even knowing what splits are the fact that the exist and are utilized implies they have some sort of effect which is a change which is a difference.
Right now many don't have any Apple stock at $300.00, but those same people might buy 10 or so shares at $150.00. Even if it's an emotional thing, If you get 10 of something and spend $1500.00 or 5 at $300.0 ? I have more with the 10 shares
And just wait until those shares go to $300.00, then I've done real good.
Skip
There is definitely a psychological component to stock buying and selling. We all do things for irrational reasons even if we use "facts and figures" to justify our actions.
Better to show the valuation and/or profits. Stock price or number of shares on their own are ambiguous.
True. However, it's noteworthy that in the thirteen years since Michael Dell made his infamous statement, AAPL is up over 5319% while Dell has been essentially flat.
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
You are the only one who has included reverse splits in your argument and it only muddies the conversation. There are actually legitimate reasons for a company to do a reverse split, e.g. some institutional investors will not buy a stock below a certain per share cost, some stock exchanges delist a stock if its stock price falls below a certain value. Clearly, these considerations do not apply in the case of forward stock splits.
You are correct in noting that stock splits cost the companies money in administrative costs. This is part of the reason we see fewer stock splits these days.
True. However, it's noteworthy that in the thirteen years since Michael Dell made his infamous statement, AAPL is up over 5319% while Dell has been essentially flat.
An even more damning analysis shows a distinct divergence about five years ago. AAPL has risen 839% while Dell has declined 66%.
Amazing .... how the mighty have fallen eh?
I suspect the same model Dell et al used so well for a long time, i.e. build cheap junk and put on an OS from a software company (MS) is not going to work as well the second time around. I am referring to Android and all the hardware manufacturers seeing it as their second coming. Time will tell of course but their margins even with a free OS are going to be pared to the bone as they all fight over the same turf.
.... but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means......
Not sure if you mean me in reference to this, but my argument was somewhat the opposite (and perhaps a tad subtle): that companies might think that it makes a difference if there is signaling value in the marketplace.
There are actually legitimate reasons for a company to do a reverse split, e.g. some institutional investors will not buy a stock below a certain per share cost, some stock exchanges delist a stock if its stock price falls below a certain value. Clearly, these considerations do not apply in the case of forward stock splits.
So, to be clear ... Team A would be just as happy with AAPL at that price ($2400 per share) and believe this would change absolutely nothing? That would be consistent with their belief splits are pointless after all.
In principle, yes, Team A would be just as happy. In practice, there is a comfort and convenience factor (e.g., similar to why we don't observe million dollar bills in circulation, although there are many millionaires) which, when combined with the fact that it doesn't hurt and may allow insiders to signal something about future prospects for the company at the margin, that might make someone from Team A shrug their shoulders and go 'whatever.'
In principle, yes, Team A would be just as happy. In practice, there is a comfort and convenience factor (e.g., similar to why we don't observe million dollar bills in circulation, although there are many millionaires) which, when combined with the fact that it doesn't hurt and may allow insiders to signal something about future prospects for the company at the margin, that might make someone from Team A shrug their shoulders and go 'whatever.'
That does not, however, make Team B right.
The idea of sending a positive signal may have been a factor at one time, but now I believe individual investors have much better information, so it is not necessary for a company to communicate in that way. Additionally, I don't necessarily trust insiders. What they might be doing is trying to get a short term bump so they can dump their shares or survive the next shareholder meeting.
To the people desiring Apple to split its stock on the theory that it will cause the price to rise:
I don't think AAPL would see any price bump by splitting their stock. With its massive market cap, there are not enough investors only able to spend <$300 to increase demand for AAPL enough to affect the price significantly.
After a spilt, when the stock goes up 1$ in value during the day, you simply have double the jackpot, compared the stock rising 1$ before the splt. I think this has a huge psycological effect. And it might stimulate more and faster trading.
Since stocks are traded within an acuracy of xx amount of cents, there must be a mathematical proof that a lower value in USD per stock means faster up's and downs for the stock. I am not sure what is the lowest value a stock can fluctuate though...is it 0.01 cent?
After all the stock market is dependant on the 24 hour day/night cycle of news and closing times. And on peoples day rythms. (When you wake up you have to notice a change) So there has to be a mathematical effect if the stock fluctuates in barely noticable 0.001 cents or in full dollars. And this effect must affect the daily stock movements ever so slightly.
There has to be some statistics that either prove or disprove this...
Comments
Is it just me .... or is this just too funny?
It was deliberate sardonic humor. Sorry if too subtle
Google "what is Apple's Market Cap" and you will know the answer.
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
It was deliberate sardonic humor. Sorry if too subtle
I did say it was funny .... sorry if you "missed" that.
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
I ask you this, as recently calculated by a fellow poster... without any splits, AAPL would be $2400 a share. This would have zero effect on anything by your reasoning?
That's not true - Apple split many times before it went public. The value of the share without any splits would be the value of the company.
And no, Apple's stock price would be no different without splits (your $2400) than with splits.
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
You realize that none of the money spent when buying a share goes to the company, right? Once a company goes public, all shares are sold and bought by third parties, the company has no gain or loss as a result, except of course when it issues new shares (a secondary offering).
I did say it was funny .... sorry if you "missed" that.
Haha I was really replying to the wrong person there sorry
It took a lot of guts to admit that... but I still couldn't help but laugh out loud when I read it. Sorry.
+1... Sorry for that!
That's not true - Apple split many times before it went public. The value of the share without any splits would be the value of the company.
And no, Apple's stock price would be no different without splits (your $2400) than with splits.
I didn't say the stock value would change. I asked if it would have any effect on anything ... would $2400 a share (pick any massively high number simply as a discussion point) change any dynamics what so ever? Team B's reasoning says it would, Team A's says it wouldn't. I was wondering if an extreme case might make you see the obvious.
Every time Apple achieves something I remember Michael Dell and his advice to Apple when he said Apple should reimburse the money to the stock holders.
Ironic eh?
Apple 300.76
Dell 14.06
hehehe
Better to show the valuation and/or profits. Stock price or number of shares on their own are ambiguous.
I didn't say the stock value would change. I asked if it would have any effect on anything ... would $2400 a share (pick any massively high number simply as a discussion point) change any dynamics what so ever? Team B's reasoning says it would, Team A's says it wouldn't. I was wondering if an extreme case might make you see the obvious.
Without even knowing what splits are the fact that the exist and are utilized implies they have some sort of effect which is a change which is a difference.
Thanks to Apple i can afford to pay people to tell me how cool I am.
No need. I'll tell you for free... once.
It does make a difference for some (many).
Right now many don't have any Apple stock at $300.00, but those same people might buy 10 or so shares at $150.00. Even if it's an emotional thing, If you get 10 of something and spend $1500.00 or 5 at $300.0 ? I have more with the 10 shares
And just wait until those shares go to $300.00, then I've done real good.
Skip
There is definitely a psychological component to stock buying and selling. We all do things for irrational reasons even if we use "facts and figures" to justify our actions.
Better to show the valuation and/or profits. Stock price or number of shares on their own are ambiguous.
True. However, it's noteworthy that in the thirteen years since Michael Dell made his infamous statement, AAPL is up over 5319% while Dell has been essentially flat.
http://news.cnet.com/Dell-Apple-shou..._3-203937.html
http://www.google.com/finance?chdnp=...ntsp=0&fct=big
http://www.google.com/finance?chdnp=...ntsp=0&fct=big
An even more damning analysis shows a distinct divergence about five years ago. AAPL has risen 839% while Dell has declined 66%.
I don't even want to engage them anyone in this discussion. He's a poster I like and respect on this forum but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means that it costs the company and therefore shareholder money to complete this economic feat. If that is case then all shareholders should file injunction against any all companies that do such wasteful and pointless things.
He says the MC would change a penny if the stock was $2,400/share. If he really thinks the price per share makes no difference then he also has to think that about $10,000/share or $100,000/share or $1,000,000/share or $10,000,000/share.
You are the only one who has included reverse splits in your argument and it only muddies the conversation. There are actually legitimate reasons for a company to do a reverse split, e.g. some institutional investors will not buy a stock below a certain per share cost, some stock exchanges delist a stock if its stock price falls below a certain value. Clearly, these considerations do not apply in the case of forward stock splits.
You are correct in noting that stock splits cost the companies money in administrative costs. This is part of the reason we see fewer stock splits these days.
True. However, it's noteworthy that in the thirteen years since Michael Dell made his infamous statement, AAPL is up over 5319% while Dell has been essentially flat.
http://news.cnet.com/Dell-Apple-shou..._3-203937.html
http://www.google.com/finance?chdnp=...ntsp=0&fct=big
http://www.google.com/finance?chdnp=...ntsp=0&fct=big
An even more damning analysis shows a distinct divergence about five years ago. AAPL has risen 839% while Dell has declined 66%.
Amazing .... how the mighty have fallen eh?
I suspect the same model Dell et al used so well for a long time, i.e. build cheap junk and put on an OS from a software company (MS) is not going to work as well the second time around. I am referring to Android and all the hardware manufacturers seeing it as their second coming. Time will tell of course but their margins even with a free OS are going to be pared to the bone as they all fight over the same turf.
.... but it's an obtuse and silly notion to think companies spend time and money to split or reverse split a stock when it makes no difference. In fact, his argument means......
Not sure if you mean me in reference to this, but my argument was somewhat the opposite (and perhaps a tad subtle): that companies might think that it makes a difference if there is signaling value in the marketplace.
There are actually legitimate reasons for a company to do a reverse split, e.g. some institutional investors will not buy a stock below a certain per share cost, some stock exchanges delist a stock if its stock price falls below a certain value. Clearly, these considerations do not apply in the case of forward stock splits.
Good points there!
So, to be clear ... Team A would be just as happy with AAPL at that price ($2400 per share) and believe this would change absolutely nothing? That would be consistent with their belief splits are pointless after all.
In principle, yes, Team A would be just as happy. In practice, there is a comfort and convenience factor (e.g., similar to why we don't observe million dollar bills in circulation, although there are many millionaires) which, when combined with the fact that it doesn't hurt and may allow insiders to signal something about future prospects for the company at the margin, that might make someone from Team A shrug their shoulders and go 'whatever.'
That does not, however, make Team B right.
In principle, yes, Team A would be just as happy. In practice, there is a comfort and convenience factor (e.g., similar to why we don't observe million dollar bills in circulation, although there are many millionaires) which, when combined with the fact that it doesn't hurt and may allow insiders to signal something about future prospects for the company at the margin, that might make someone from Team A shrug their shoulders and go 'whatever.'
That does not, however, make Team B right.
The idea of sending a positive signal may have been a factor at one time, but now I believe individual investors have much better information, so it is not necessary for a company to communicate in that way. Additionally, I don't necessarily trust insiders. What they might be doing is trying to get a short term bump so they can dump their shares or survive the next shareholder meeting.
To the people desiring Apple to split its stock on the theory that it will cause the price to rise:
I don't think AAPL would see any price bump by splitting their stock. With its massive market cap, there are not enough investors only able to spend <$300 to increase demand for AAPL enough to affect the price significantly.
Since stocks are traded within an acuracy of xx amount of cents, there must be a mathematical proof that a lower value in USD per stock means faster up's and downs for the stock. I am not sure what is the lowest value a stock can fluctuate though...is it 0.01 cent?
After all the stock market is dependant on the 24 hour day/night cycle of news and closing times. And on peoples day rythms. (When you wake up you have to notice a change) So there has to be a mathematical effect if the stock fluctuates in barely noticable 0.001 cents or in full dollars. And this effect must affect the daily stock movements ever so slightly.
There has to be some statistics that either prove or disprove this...