公司财务与金融(ppt 864页).ppt

Both stock dividends and stock splits increase the number of shares outstanding, so “the pie is divided into smaller pieces.” Unless the stock dividend or split conveys information, or is accompanied by another event like higher dividends, the stock price falls so as to keep each investor’s wealth unchanged. But splits/stock dividends may get us to an “optimal price range.” When should a firm consider splitting its stock? There’s a widespread belief that the optimal price range for stocks is $20 to $80. Stock splits can be used to keep the price in the optimal range. Stock splits generall