Why Apple, Inc decided to split its stock 7-1

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  • Reply 61 of 99
    bravadubravadu Posts: 37member
    Quote:
    Originally Posted by Frood View Post

     

    To acheive that they created a new class of shares that has no voting rights.  The stock split itself changed nothing as far as ownership percentages or voting strength.   It does allow Google to issue more shares to employees in the future without running the risk that Larry and Sergey lose total control of the company.




     


    Larry and Sergey will also be able to buy more yachts and more planes without having more control slip out of their fingers.

     

    It's good to be able to have your cake and eat it too, but you need more than 50% control in the first place to make it happen.

     

    I think that letting other shareholders have a say is a good thing even if it's activist shareholders like Icahn or the others.  If they can somehow pull off a voting win, then that's democracy at work.

  • Reply 62 of 99
    wwwwwwwwwwww Posts: 2member

    Sure he didn't say they would never do it BUT he did say this:  "And the current information we have would suggest that there's very little support that it helps the stock."   So what changed from May 2012 and every quarter after that up until last week?  What new information did they have?

     

    Maybe Cook finally read your letter and decided you were right.

  • Reply 63 of 99
    wwwwwwwwwwww Posts: 2member
    Quote:

    Originally Posted by JeffDM View Post



    Stock splits don't change real value though, for one seventh the price as before, you get one seventh the company as before. The only reason it makes any difference is when you're dealing with non-rational influences.

     

    Like the ones with money.

  • Reply 64 of 99
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by Carthusia View Post

     

    Thanks for the link!


     

    I recommend www.schwab.com ... just personal preference. I like being able to go visit one of their offices if I have a question or concern. I used to have an E-trade account a loooooong time ago, but they screwed up an order and it was difficult to get ahold of a real person. I pulled my entire account.

  • Reply 65 of 99
    dickprinterdickprinter Posts: 1,060member
    Quote:

    Originally Posted by Tallest Skil View Post

     

     

    How horrible. Steve Jobs would have never… OH WAIT HE DID EXACTLY THOSE THINGS.


     

    Quote:

    Originally Posted by Tallest Skil View Post

     

     

    Sure.

     

    Two splits under Steve after his return…

     

    And between 2003 and 2005 there weren’t any “new products”.


    In all fairness, Steve also said, during a conference call, that he would not authorize a stock split after the last one because he wanted to show the true value of the company and stock splits dilute the perceived value.

  • Reply 66 of 99
    After the splits this stock is easily going to $100 by EOY 2014.
  • Reply 67 of 99
    solipsismxsolipsismx Posts: 19,566member
    In all fairness, Steve also said, during a conference call, that he would not authorize a stock split after the last one because he wanted to show the true value of the company and stock splits dilute the perceived value.

    I don't think he anticipated the success of the iPhone and iPad. At $600 it does prevent a lot of investors from getting in. So much so that I think it's hard to imagine Jobs not being alright with the split.


    edit: To be clear, I do agree with Jobs that it can dilute the perceived value but making the stock too expensive will definitely prevent many investors from getting onboard. Now some could say that those that can't afford $600 per share don't deserve to invest with Apple but what if you have $1000 to invest. Not a bad starting point but at $1000 you can only invest $600 for one share (and one share also gets perceived in a negative light as opposed to having a dozen shares at the 7:1 split value. It also means that an investor can invest their $1000, not just $600 and probably squeeze out that extra $28 to buy just over $1000 worth instead of 11 shares just under $1000, but trying to squeezing out a couple hundred dollars more for 2 whole shares seems less likely to me.

    PS: If Apple never did a split the share price today, ignoring all psychological aspects of splitting, would be $4738.64 with 23. (Is that math correct for 3x 2:1 splits?)
  • Reply 68 of 99
    shahhet2shahhet2 Posts: 149member
    bravadu wrote: »
     

    Larry and Sergey will also be able to buy more yachts and more planes without having more control slip out of their fingers.

    It's good to be able to have your cake and eat it too, but you need more than 50% control in the first place to make it happen.


    I think that letting other shareholders have a say is a good thing even if it's activist shareholders like Icahn or the others.  If they can somehow pull off a voting win, then that's democracy at work.
    1. What does class B shares have anything to do with current split between class a and class c?
    It was there even before split.
    2. What stops you or any investor from selling your class C shares without voting power with class A?
    As he explained, this was done for employee stocks.
    Try to understand the purpose before blinding bashing.

    As far as Ownership % goes, this is very common Where company was invented by 1-2 person entity.
    For eg. Microsoft with Bill gates before recent release of shares for charity or Google or Facebook.
    They invented the company and keeping voting power, which is obvious. What is wrong with that?
  • Reply 69 of 99
    jungmarkjungmark Posts: 6,926member
    pazuzu wrote: »
    REALLY? NAME IT.
    NAME A 3 YEAR PERIOD WHEN SJ RETURNED AND THERE WASNT A NEW PRODUCT LINE INTRODUCED.

    This guy seems quiet now
  • Reply 70 of 99
    chris_cachris_ca Posts: 2,543member
    Quote:

    Originally Posted by AppleInsider View Post



    However, as Apple's stock has tumbled into oblivion in 2013, 

    Oblivion? Really?

    Started 2013 at $549 and April it was $390.

    Really good drop but not even close to oblivion...

  • Reply 71 of 99
    dsddsd Posts: 186member
    Quote:

    Originally Posted by Tallest Skil View Post

     

     

    Samsung's board has  just announced its proposed 129,000:1 stock split, making the value of each share a penny.  Samsung CEO Dr. Oh-Hyun Kwon today stated, "This is just one more example of Samsung's smooth innovation. Penny stocks are the next big thing."

  • Reply 72 of 99
    pazuzupazuzu Posts: 1,728member
    Quote:
    Originally Posted by SolipsismX View Post





    Do you ever think before you post? image Two seconds of research to find Apple's 2nd and 3rd split on June 21, 2000 and February 18th, 2005. (Do I need to write "respectively" for you to know which came after the other?)
    Mac in 1984 … 17 years … iPod in 2001 … 6 years … iPhone in 2007 … 3 years … iPad in 2010. The iPad took three years despite using pretty much all the parts of the iPhone and you think Apple should be able to reinvent the TV, watch, and anything else in under 3 years after each new product release.

    What's an Apple TV ?  Time Capsule? Nano?  Cube?  iBook? Magic mouse? Trackpad? 

    IS English your second language????image 

  • Reply 73 of 99
    solipsismxsolipsismx Posts: 19,566member
    pazuzu wrote: »
    What's an Apple TV ?  Time Capsule? Nano?  Cube?  iBook? Magic mouse? Trackpad? 

    The Apple TV is certainly a new product category but that also occurred in 2010 — or 2009 if you start with the atypical pre-announcement announcement — so it's still inline with the iPhone release time. Its' not just now getting off of "hobby' status (under Cook, I might add) so if it's radically change, as people hope, we might want to consider that the start of the product category; especially if you want to consider the Time Capsule a new product category just for putting an HDD in a Airport Extreme.

    As for the others, we're talking about an iPod, two Macs, one is a router, and two are peripherals for a Mac.

    PS: Magic Mouse? Really? You want to use Apple's mouse as proof that Apple under Jobs was nothing but a machine of brilliant ideas and innovation. Shame on you for wasting our time. :no:
    IS English your second language????

    If you want to make a foolish comment about my ability to communicate well, much less in English, you're going to regret it.
  • Reply 74 of 99
    Quote:

    Originally Posted by addicted44 View Post

     

    I think 1 aspect of this split a lot of people are ignoring is that this makes the Apple stock available to the vanity "investor".

     

    This may be someone who isn't really into investing, but is an Apple fan, and would like to "own" a piece of Apple. It's far easier to do that if you have to pay only $70 instead of $500.

     

    Now, this may not affect AAPL's price at all, but what it does is strengthens the loyalty of the customer. Such purchases won't help Apple on the financial side, but will help them on the customer retention, and word of mouth advertising sides, as this person is far more invested in the company (pun intended) than if he only purchased the products and did not have that single stock.




    Yeah...I pretty much want at least a share for that reason.

  • Reply 75 of 99
    jungmarkjungmark Posts: 6,926member
    pazuzu wrote: »
    What's an Apple TV ?  Time Capsule? Nano?  Cube?  iBook? Magic mouse? Trackpad? 
    IS English your second language????<img alt="1rolleyes.gif" src="http://forums-files.appleinsider.com/images/smilies/1rolleyes.gif" style="line-height:1.4em;">
     

    So you include an iPod nano but won't include the iPad Air or the iPhone 5? You include the Cube but won't count the Mac Pro?

    Let me guess, Cook iterates and only Jobs innovates.
  • Reply 76 of 99
    froodfrood Posts: 771member
    Quote:

    Originally Posted by Bravadu View Post

     
     


    Larry and Sergey will also be able to buy more yachts and more planes without having more control slip out of their fingers.

     

    It's good to be able to have your cake and eat it too, but you need more than 50% control in the first place to make it happen.

     

    I think that letting other shareholders have a say is a good thing even if it's activist shareholders like Icahn or the others.  If they can somehow pull off a voting win, then that's democracy at work.


     

    I don't believe Larry and Sergey are primarily money motivated, but I'm sure they're not allergic to money and probably find the stuff quite useful.  If anything they are so rich that they just really don't have to care (each of them has more than twice the wealth Steve Jobs had).  I believe they do it because they want to change the world- and if you look at the projects they are doing most are consistent in that track and may not make Google a dime.  Having that much control is what allows them to do the moonshot projects that would not be allowed at more traditional companies- and that's what I think they are concerned about losing the ability to do.  Just as Jobs' biography is a good book whether you like or hate Steve, 'Googled' is a great read and pretty good insight to how Google got its start.

     

    That structure is more and more common among tech companies.  There are advantages and disadvantages.  As a shareholder your best bet is to know what you're investing in and put your money in accordingly.  If not having a say in a company and knowing that they do far-fetched projects rubs you the wrong way- I definitely wouldn't recommend Google shares for you.

  • Reply 77 of 99
    davidwdavidw Posts: 2,024member
    Quote:
    Originally Posted by rob53 View Post

     

    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.


     

    Depending on your age and how much you have in the IRA, a better strategy might be to withdrawal as much from your IRA each year, so long as you don't have to pay more than 20% tax on it. Take the extra money you took out and put it in a Roth IRA. (Invest it back in AAPL or other dividend stocks) Do this every year until all the money is gone from your traditional IRA. Now you have all your money in a Roth IRA and everything in it is tax free for the rest of your retirement. Plus you only paid capital gains rate on all the money you had in the traditional IRA. 

     

    70 and 1/2 is the magic number. At that age you are required to withdrawal a minimum amount depending on how much you have in it. That minimum amount (RMD) may put you above the 35% tax bracket if there's still too much money in your IRA. Taking it out a little at a time every year might not be enough. Specially if you have a lot of  AAPL and it duplicates in the next 5 years what it did in the past 5 years.  In which case, selling a big chunk of your AAPL that is in your IRA now and buying it back (after taxes) in a Roth might be the thing to do if you think AAPL with reach $120/s. At that point, it would have paid for the 28% to 35% tax you might have paid to take it out of your IRA all at once. And really, you're are going to have to pay at the least 15% to 20% tax on it even if you took it out over several years. But by that time, AAPL could be at $200/s. With all the gains being all taxable if it were still in your IRA and tax free in you pay the taxes now and transfer it into a Roth.  It's never too late to plan for your retirement, even after you retire. 

  • Reply 78 of 99
    eric38eric38 Posts: 100member
    If an individual investor is selling an $80 share and paying $5 to $15 in fees to a broker, there is no hope for said investor.
  • Reply 79 of 99

    Quote:


    Originally Posted by jungmark View Post



    Originally Posted by pazuzu View Post

     

    What's an Apple TV ?  Time Capsule? Nano?  Cube?  iBook? Magic mouse? Trackpad? 

    IS English your second language????image 




    So you include an iPod nano but won't include the iPad Air or the iPhone 5? You include the Cube but won't count the Mac Pro?



    Let me guess, Cook iterates and only Jobs innovates.

     

    I advice you not to piss this guy off unless you know Max Von Sydow personally.

  • Reply 80 of 99
    solipsismxsolipsismx Posts: 19,566member
    eric38 wrote: »
    If an individual investor is selling an $80 share and paying $5 to $15 in fees to a broker, there is no hope for said investor.

    You do understand that the cost of $5 to $15 is for the trade, not for each share, right? If you only buy or sell one share at $85 then the trade will cost you $5 to $15 but before June 9th happens that's not even an options since it's now about $600 per share. What if you only want to buy or sell $500? You can't, but as of June 9th you can and it will cost you $5 to $15 at most internet-based brokerage firms.
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