Amazon Is Splitting Its Stock. Why It Wants A Lower Share Price

Mar 10, 2022

Amazon Is Splitting Its Stock. Why It Wants A Lower Share Price

Amazon stock is surging after the e-commerce and cloud computing company confirmed a 20-for-1 stock split and an extended stock-repurchase program.

While stock splits don't add value to holders mathematically—they're the financial equivalent of splitting a pie into smaller pieces—retail investors appreciate them, and split announcements often cause short-term rallies. Indeed, Amazon stocks rose 6.4% to $2,962.34 on Thursday.

Amazon also announced a $10 billion stock-repurchase program, which replaces a prior $5 billion stock-purchase authorization, under which it repurchased $2.12 billion of its own shares. The plan does not have a set end date.

The Amazon split comes on the heels of Alphabet's announcement in February that it would split its shares 20-for-1 beginning July 15. In 2020, Apple will divide its shares four-for-one.

One possible advantage of the Amazon stock split, as with Alphabet, might be the inclusion of the corporation's equities in the Dow Jones Industrial Average.

Adding high-priced stocks to the Dow is difficult because the index is price-weighted, which means that the same percentage move counts more for a high-priced stock than a low-priced firm. So a 1% rise in UnitedHealth, which trades for $486 per share and has the highest-priced stock in the Dow, has almost three times the weight in the index as a similar move in Apple, which finished Wednesday at $163.

Adding a stock with a four-digit price tag would immediately give the corporation the biggest weighting in the index since neither Amazon nor Alphabet are presently included in the index. The splits have the potential to alter that.

It is also worth noting that the Dow component list is updated infrequently—the most recent changes were in August 2020, when Amgen, Honeywell, and Salesforce.com were added to the index, replacing Exxon Mobil, Pfizer, and Raytheon.

The Amazon split will go into effect on May 27 at the end of the business day.

Subscribe Our Newsletter

Americans Ditched High-Tax States During Pandemic, Study Finds
Americans Ditched High-Tax States During Pandemic, Study Finds

As a Tax Foundation report showed, regions with high-income tax rates witnessed considerable losses of residents, and areas with low taxes witnessed a rapid rise in population.

Companies
Goldman Sachs Expects Four Rate Hikes In 2022. It’s Not All Bad News For Stocks
Goldman Sachs Expects Four Rate Hikes In 2022. It’s Not All Bad News For Stocks

He also mentioned the Federal Open Market Committee's (FOMC) debates over the Fed's balance sheet, which he said demonstrated a "greater sense of urgency than it was predicted."

Stocks
Get the ultimate solution: B2BinPay Get the ultimate solution: B2BinPay
Sponsored
Alexander

How Brokers and Liquidity Providers Collaborate for Optimal Execution
In this articlе, we will еxplore the mechanics behind broker-LP relationships and the challengеs that may arise in such a partnership.

discover
Top 5 Most Prospective Tokens in the Metaverse.

Constantine

Top 5 Most Prospective Tokens in the Metaverse.

Over the past 20 years, information technology has determined the development vector of the main spheres of society: economic, political, spiritual, and social.

Fintech
Contact us bg

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiries

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Сonstantine

    Internal vs External Range Liquidity In ICT Trading Explained

    Internal vs External Range Liquidity In ICT Trading

    Constantine

    Portfolio Backtesting — Tools, Metrics, and Methods Explained

    Portfolio Backtesting

    Сonstantine

    ICT Trading Explained: Smart Money Concepts, Tools and Setups

    ICT Trading Explained

    Сonstantine

    CFD Trading Strategies: A Practical Guide to Risk and Execution

    CFD Trading Strategies

    Alexander

    What is a Fair Value Gap? A Guide to Trading Market Imbalances

    What is Fair Value Gap

    Vitaliy

    Triangle Patterns in Trading: Mastering Ascending, Descending & Symmetrical Strategies for Maximum Profit

    Triangle Patterns in Trading: Ascending, Descending & Symmetrical Guide

    Alexander

    What Is COTI? Payments, Token & Price Prediction

    What is a COTI coin

    Constantine

    Best Copy Trading Software in 2025

    Best Copy Trading Software in 2025

    Alex

    What Is an AI Agent? The Future of Finance Explained

    AI Agent Explained

    Constantine

    How to Start a Liquidity Provider Business?

    How to Start a Liquidity Provider Business

    Constantine

    How to Start a White Label Brokerage?

    How to start a white label brokerage

    Constantine

    How to Start a Multi-Asset Brokerage?

    How to Start a Multi-Asset Brokerage

    Hazem

    Crypto Ransomware – How They Happen and How to Avoid Them

    Crypto ransomware explained

    Constantine

    Best Web3 Browsers in 2025

    Best Web3 Browsers

    Constantine

    Best DAO Projects in 2025

    Best DAO projects in 2025

    Alexander

    Crypto Nodes That Pay: Your 2025 Guide to Top Passive Income Opportunities in Crypto

    crypto nodes that pay

    Alex

    Pi Network: Scam or Groundbreaking Crypto? The Full Analysis

    Pi Network Explained

    Constantine

    Triple Net Lease: Meaning, Benefits, and Strategies Explained

    Triple Net Lease

    Constantine

    Hanging Man Pattern: How to Identify and Trade It Effectively

    Hanging Man Pattern

    Alex

    5 Infinite Banking Mistakes That Could Cost You Thousands

    Infinite Banking Mistakes to Avoid

    Aleksander

    Solana Firedancer: Solving Solana’s Biggest Problems with a New Engine

    Solana Firedancer explained

    Alexander

    What Is an Interest Coverage Ratio? How to Use This Financial Metric to Evaluate Company Health

    Interest Coverage Ratio Explained

    Hazem

    After-Hours Trading: Can You Trade After Financial Markets Close?

    After-Hours Trading Explained

    Alexander

    How to Scale a Crypto Exchange Business and Stay Competitive

    how to scale crypto exchange business
    liquidity-provider-logo
    • News
      • Stock Market Forecast
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
      • White Label Brokerage Platforms
      • Broker CRM Platforms
    [email protected]

    © 2024 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site. Switch to a production site key to remove this banner.