Since 2023 began, excitement surrounding artificial intelligence (AI) has sent all three of Wall Street’s major stock indexes to fresh record-closing highs. But while AI seemingly gets all the credit, companies enacting stock splits have quickly become one of the stock market’s hottest trends.
A stock split is an event that allows publicly traded companies to cosmetically adjust their share price and outstanding share count by the same magnitude. Splits are purely superficial in the sense that they don’t affect a company’s market cap or operating performance.
Stocks splits fall into two categories — forward and reverse — with investors undeniably favoring the former.
With a reverse-stock split, a company is increasing its share price, often with the goal of maintaining the minimum continued listing standards of a major stock exchange. In other words,…
