I'm not following. The split doesn't change the value in and of itself, and if the stock drops for common shareholders it also drops for Page, Brin and Schmidt.
No one's ownership was changed. However, outside investors' influence was halved and insiders' influence was doubled.
It was a very dirty move, IMO. Surprised there wasn't much of an uproar (OTOH, I am not. The people suffering the most were probably the smaller guys, since the institutional investors were probably aware of this, and most likely also ended up on the beneficiaries side).
Psychologically, reaching $165/share rather than $1160 per share to become a trillion dollar company seems more achievable.
Of course, the lower the share price the more investors there can be so the stock could become more volatile but in this day and age with such easy and cheap trades I think this adds to the volatility the way an electron adds to the weight of an atom.
I'm thinking that $165 is doable with in 18 to 24 months. What say you oh wise one?
I'm thinking that $165 is doable with in 18 to 24 months. What say you oh wise one?
I thought I had written that I think that could happen within a couple years, especially if they have also have new killer product category, but I can't seem to find it. So, yes, I agree with your assessment.
I was glad to hear about the split, as I can hopefully pick up a few shares at a reasonable price. As long as it ends up being in the $70-$90 range when the split happens.
Psychologically, that resets the 2014 Apple stock clock to point where investors can imagine another four year long appreciation in value, without being distracted by the last two years' reminder of a bandwagon of investment in Google as investors scurried away from Apple's profitability to instead fund Google's breathtakingly expensive $12.5 billion acquisition in Motorola Mobility, cover all of its subsequent billions in operational losses, and take on accountability for Samsung's patent infringement via a <a href="http://appleinsider.com/articles/14/04/22/after-putting-google-on-the-hook-for-infringement-of-iphone-patents-samsung-lied-about-it">secret indemnification agreement</a> that even Samsung didn't want anyone to know about.
I thought the article was excellent ...
except for the highlighted section above.
It seems DED/Corrections cannot resist a childish outburst to try to further his agenda or a perceived slight.
What does any of this have to do with the reasons and mechanics of Apple's stock split?
Since my AAPL stock is within an IRA and my dividends are reinvested, it will make it easier to get full shares instead of fraction of shares. In some people's minds (mine included when I'm not thinking), having more shares looks better than fewer shares even though those fewer shares were worth more money. I've always hated to see AAPL drop by large numbers even though the percentage drop wasn't always that much. I'll need to reset my mental calculator in June when AAPL moves by a few points, which would be several points now.
I've always hated getting $100 bills through an ATM since it's much easier to spend the whole thing. I'd rather get $20's and be able to show some restraint. :-)
Originally Posted by tundraboy
I hope your AAPL is in a Roth IRA.
Of course not, that would have made too much sense. /s
I retired last year with a buyout so the cost of starting the Roth would have meant paying taxes at a much higher rate than I will be paying when I actually withdraw funds associated with this stock. The AAPL purchase used fun money my financial advisor said would be ok. I want to keep it long term but also want to use my gain to buy a new Mac, which means I need to wait until after the June split to see what happens.
Of course not, that would have made too much sense. /s
I retired last year with a buyout so the cost of starting the Roth would have meant paying taxes at a much higher rate than I will be paying when I actually withdraw funds associated with this stock. The AAPL purchase used fun money my financial advisor said would be ok. I want to keep it long term but also want to use my gain to buy a new Mac, which means I need to wait until after the June split to see what happens.
Correct me if I'm wrong but in a Trad IRA, won't your AAPL cap gains be taxed as current income rate rather than capital gains?
Maybe he's referring to how Google issued a different class of shares. I don't really follow GOOG all that much, but I remember reading something about that. In addition to GOOG, there's also something called GOOGL I noticed.
GOOG - Class C - No Vote GOOGL - Class A - 1 vote/share
No Symbol - Class B - 10 votes/share (reserved for Google insiders only)
Google "split" the stock so they could issue Class C shares without diluting their voting percentage.
I'm not following. The split doesn't change the value in and of itself, and if the stock drops for common shareholders it also drops for Page, Brin and Schmidt.
No one's ownership was changed. However, outside investors' influence was halved and insiders' influence was doubled.
It was a very dirty move, IMO. Surprised there wasn't much of an uproar (OTOH, I am not. The people suffering the most were probably the smaller guys, since the institutional investors were probably aware of this, and most likely also ended up on the beneficiaries side).
There was an uproar. The split was delayed for many months due to shareholder legal action.
Nobody's voting influence has changed yet.
For every 100 original stock of GOOG, Google issued 100 of GOOG (Class C) and 100 of GOOGL(Class A),
So your voting power stays same.
It's for Employee RSU and other places, where new stocks they issue are of type GOOG (Class C), with no voting power.
It's just too much wrong information out there since people just don't understand.
Correct. Everybody had the same number of votes after the split that they had before, contrary to DED's idea that Google somehow took votes away from people.
Too bad Cook waited so long. I pleaded with him and Apple Investor relations in May of 2012 to split the stock.
Here was my letter to Apple IR and to Tim Cook:
I've been investing for 20 years and never have I seen such ignorance of how market psychology works. Stock prices are relevant to investor perception of value. At apple's high share price investors believe the stock is expensive. This includes professionals and retail. There was a reason for the last 100 years companies split their stock. It wasn't for kicks. It was to maximize shareholder value and broaden the base. Books and studies are written about this. Apple itself used to split the stock. Why did the comnpany do it in the past but refuses to now? What do great companies like Microsoft, Oracle, Wal-Mart, Coke, Pepsi, GE all know about splits that Apple is seemingly ignorant about?
It's time for a 1o or even 20 for 1 stock split. Bring the price down and change perception. Get the news media fascination off the stock price and their endless assaults. If high share prices made sense companies would go public in the triple or quadruple digits. They would reverse split to ensure prices were in the hundreds or thousands. Why don't they do that? As a sharolder with <witheld> dollars worth of Apple stock I implore the board to vote on this. It is to the benefit of every apple employee and shareholder.
Here was their response back:
When we announced the dividend and stock repurchase plan in March, our CEO, Tim Cook was asked about splitting the stock and here was his reply:
This is something that we have looked at while we were looking at this cash question. And the current information we have would suggest that there's very little support that it helps the stock. However, we are in a unique position and at a unique point in time, and so this is something that we continue to look at. And if we reached a decision that we thought it was in the best interest ofApple and its shareholders, we would do it. But again, at this point that's not how we see it.
I don't have anything new to update you with today, but wanted you to have our latest public thoughts on the matter.
Best regards,
xxxx xxxxxx
Apple Investor Relations
When Apple announced earnings on Jan 23rd of 2013 and didn't announce a split I sold every share I owned after hours at the end of the conference call. Did better still today in what I reinvested in even after paying the tax hit on the big gains I had. It's just amazing the 180 Cook did and his lack of vision to pull the trigger ahead of time rather than so very late in the game. I fear he will do this with other decisions and trends. He's slow moving and slow to realize things in the future. I truly believe he lacks a vision and understanding but who can blame him as he was an operating officer, not a visionary.
Plus the possible inclusion of Apple into Dow without retune the component ratio formulation. Thus more index tracking funds. If those Google thieves try to copy, when their stock bubble burst. They will become penny stocks ?
It's just amazing the 180 Cook did and his lack of vision to pull the trigger ahead of time rather than so very late in the game.
There is no 180° turn here. Cook didn't say they would never split the stock just to split it the next year. He stated Apple had been looking into it and would continue to look into. He also stated that with the "current information" it wasn't advantageous to them. Clearly the "new information" suggested it was now advantageous. Whether you agree with when the stock should have split or by how much is irrelevant to this fact. All you call do is opine that Apple waited too long and is too slow to react, but that is not fact, just an opinion. And why blame Cook as if Apple wasn't slow to move under Jobs reign where Apple was a good half-decade after first PMP and decades after the first mobile phone and tablet. Apple rarely acts impetuous which is a big reason I am a fan of the company.
Correct me if I'm wrong but in a Trad IRA, won't your AAPL cap gains be taxed as current income rate rather than capital gains?
I believe so. My income tax rate will be much lower than a capital gains tax rate (unless I'm missing something). I'm in retirement mode so I'm not trying to get a huge annual income, only withdrawing enough to pay bills and enjoy life. This method also helps keeps my ACA health insurance costs down substantially. I'm not one of those people who is trying to die with the most amount of money, I'd just like to have enough to buy a few things and have some fun but not stress over everything.
Comments
I'm not following. The split doesn't change the value in and of itself, and if the stock drops for common shareholders it also drops for Page, Brin and Schmidt.
No one's ownership was changed. However, outside investors' influence was halved and insiders' influence was doubled.
It was a very dirty move, IMO. Surprised there wasn't much of an uproar (OTOH, I am not. The people suffering the most were probably the smaller guys, since the institutional investors were probably aware of this, and most likely also ended up on the beneficiaries side).
I'm thinking that $165 is doable with in 18 to 24 months. What say you oh wise one?
BREAKING: Apple fans predict share price to plummet to $165; company doomed
How do they get away with that?
For every 100 original stock of GOOG, Google issued 100 of GOOG (Class C) and 100 of GOOGL(Class A),
So your voting power stays same.
It's for Employee RSU and other places, where new stocks they issue are of type GOOG (Class C), with no voting power.
It's just too much wrong information out there since people just don't understand.
Beat you to it.
How about a CNN headline: Is Apple Stock Split A Result of the Disappearance of Flight MH370?
I thought I had written that I think that could happen within a couple years, especially if they have also have new killer product category, but I can't seem to find it. So, yes, I agree with your assessment.
I thought the article was excellent ...
except for the highlighted section above.
It seems DED/Corrections cannot resist a childish outburst to try to further his agenda or a perceived slight.
What does any of this have to do with the reasons and mechanics of Apple's stock split?
Since my AAPL stock is within an IRA and my dividends are reinvested, it will make it easier to get full shares instead of fraction of shares. In some people's minds (mine included when I'm not thinking), having more shares looks better than fewer shares even though those fewer shares were worth more money. I've always hated to see AAPL drop by large numbers even though the percentage drop wasn't always that much. I'll need to reset my mental calculator in June when AAPL moves by a few points, which would be several points now.
I've always hated getting $100 bills through an ATM since it's much easier to spend the whole thing. I'd rather get $20's and be able to show some restraint. :-)
I hope your AAPL is in a Roth IRA.
Of course not, that would have made too much sense. /s
I retired last year with a buyout so the cost of starting the Roth would have meant paying taxes at a much higher rate than I will be paying when I actually withdraw funds associated with this stock. The AAPL purchase used fun money my financial advisor said would be ok. I want to keep it long term but also want to use my gain to buy a new Mac, which means I need to wait until after the June split to see what happens.
Of course not, that would have made too much sense. /s
I retired last year with a buyout so the cost of starting the Roth would have meant paying taxes at a much higher rate than I will be paying when I actually withdraw funds associated with this stock. The AAPL purchase used fun money my financial advisor said would be ok. I want to keep it long term but also want to use my gain to buy a new Mac, which means I need to wait until after the June split to see what happens.
Correct me if I'm wrong but in a Trad IRA, won't your AAPL cap gains be taxed as current income rate rather than capital gains?
Watch someone call you a troll lol.
No new product line in 3 years and now a stock split.
No new product line in 3 years and now a stock split.
How horrible. Steve Jobs would have never… OH WAIT HE DID EXACTLY THOSE THINGS.
Someone who understands.
There was an uproar. The split was delayed for many months due to shareholder legal action.
Nobody's voting influence has changed yet.
Correct. Everybody had the same number of votes after the split that they had before, contrary to DED's idea that Google somehow took votes away from people.
Too bad Cook waited so long. I pleaded with him and Apple Investor relations in May of 2012 to split the stock.
Here was my letter to Apple IR and to Tim Cook:
When Apple announced earnings on Jan 23rd of 2013 and didn't announce a split I sold every share I owned after hours at the end of the conference call. Did better still today in what I reinvested in even after paying the tax hit on the big gains I had. It's just amazing the 180 Cook did and his lack of vision to pull the trigger ahead of time rather than so very late in the game. I fear he will do this with other decisions and trends. He's slow moving and slow to realize things in the future. I truly believe he lacks a vision and understanding but who can blame him as he was an operating officer, not a visionary.
There is no 180° turn here. Cook didn't say they would never split the stock just to split it the next year. He stated Apple had been looking into it and would continue to look into. He also stated that with the "current information" it wasn't advantageous to them. Clearly the "new information" suggested it was now advantageous. Whether you agree with when the stock should have split or by how much is irrelevant to this fact. All you call do is opine that Apple waited too long and is too slow to react, but that is not fact, just an opinion. And why blame Cook as if Apple wasn't slow to move under Jobs reign where Apple was a good half-decade after first PMP and decades after the first mobile phone and tablet. Apple rarely acts impetuous which is a big reason I am a fan of the company.
Correct me if I'm wrong but in a Trad IRA, won't your AAPL cap gains be taxed as current income rate rather than capital gains?
I believe so. My income tax rate will be much lower than a capital gains tax rate (unless I'm missing something). I'm in retirement mode so I'm not trying to get a huge annual income, only withdrawing enough to pay bills and enjoy life. This method also helps keeps my ACA health insurance costs down substantially. I'm not one of those people who is trying to die with the most amount of money, I'd just like to have enough to buy a few things and have some fun but not stress over everything.