Optimism on Apple as stock splits

Jun 06, 2014
Apple shares dipped Friday ahead of a 7-to-1 stock split, with shares near their highest level since October 2012 amid optimism over the tech giant's prospects

Apple shares dipped Friday ahead of a 7-to-1 stock split, with shares near their highest level since October 2012 amid optimism over the tech giant's prospects.

Shares in Apple shed 0.27 percent to $645.57, after hitting fresh highs this week on expectations for a new, larger iPhone and other products and services coming this year.

The , announced earlier this year, has no impact on the underlying value of Apple, but such a move can give a company a psychological boost by lowering the cost of each share.

The revalued shares begin trading Monday, with each shareholder getting seven new shares for each existing one.

Apple chief executive Tim Cook said the split would make Apple "more accessible to a larger number of investors."

Cantor Fitzgerald analyst Brian White said the move comes at the end of "a great week" for Apple and sees the shares rallying.

Apple this week unveiled a new mobile operating system and new software to manage personal healthcare and home appliances this week, putting the company deeper in the so-called "Internet of Things."

"We believe Apple successfully furthered its objective of more tightly integrating its digital matrix across devices, software and services," White said in a research note.

White added that his firm's research indicates Apple this year will launch a larger-screen iPhone that will boost its smartphone market and that "Apple will likely launch the 'iWatch' in September at a very affordable price point."

Keith Bachman at BMO Capital Markets also was upbeat on Apple's prospects.

"We believe that a larger screen iPhone, combined with Apple's strength in software and ecosystem, will be well received in the market," he said in a note to clients.

"While we believe that Apple is once again late with a relevant product, we think the larger screen iPhones will help generate demand."

Apple has already seen three stock splits since launching in 1980 at $22—which would be $2.75 after accounting for the splits.

Explore further: Apple will try to defy skeptics at Monday showcase

Related Stories

Icahn snaps up Apple shares as price dips

Jan 28, 2014

Activist investor Carl Icahn fired off word on Tuesday that he beefed up his Apple stock holdings by a half-billion dollars as the share price dipped.

Carl Icahn snaps up another $500M of Apple stock

Jan 23, 2014

Outspoken billionaire Carl Icahn has tossed another bushel of Apple stock into his investment portfolio as he tries to persuade the iPhone maker to buy back more of its own shares.

Recommended for you

Uber drivers fined in Hungary

9 hours ago

The Hungarian tax authority fined Uber drivers in its first probe against the ride-sharing service which the economy ministry said Saturday "ignores passenger safety" and must be made to follow regulations.

Domino's taking orders via tweet

May 22, 2015

Domino's on Wednesday launched perhaps the easiest way to satisfy a pizza craving this side of mind reading: order by tweet.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.