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The proposed stock splits of Apple (AAPL) and Tesla (TSLA) could drive future growth up to about 33%.
The proposed stock splits of Apple Inc (NASDAQ: AAPL) and Tesla Inc (NASDAQ: TSLA) billed to take effect this Monday (August 31) could drive future growth up to about 33% as eToro survey revealed. As reported by Yahoo Finance, the bullish claims made by the trading platform (eToro) is based on a careful trend observation of companies who have effected a stock split in the past. Many of whom reportedly saw growths averaging 33% following the split.
This conclusion was based on a 60-year analysis of historic market data and after the trading platform’s researchers examined different companies that have carried out share splitting in the past such as Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG), Amazon.com Inc (NASDAQ: AMZN), Coca-Cola Co (NYSE: KO), Walt Disney Co (NYSE: DIS), and Microsoft Corporation (NASDAQ: MSFT) among others.
Possible Reason for Stock Splitting: AAPL and TSLA in Focus
The decision by any Wall Street firm to split its stock has one basic underlying motive which is to make the shares more pocket friendly for investors. This drives a notion of affordability as this decision usually made when a stock price is too high.
Having experienced a cataclysmic growth in share price in the past 52 weeks, Tesla (TSLA) announced its 5-for-1 stock split earlier this month, barely two weeks after Apple (AAPL) revealed it is considering a 5-for-1 stock splitting. While AAPL has seen a about 67% increase year-to-date, TSLA has surged by over 200% in the past year.
Since the share splits were announced a few weeks ago, their share prices have jumped 167 percent and 35 percent, respectively, eToro noted.
With the proposed stock split, the perception that the companies share price being too expensive and drawing investors away will be eliminated giving more room for more investors to pump funds that will keep the companies liquidity afloat.
This stock split will be Apple (AAPL) 5th split while it will be the first for Tesla.
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