Why investors love GameStop’s stock split
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When a publicly traded company splits its stock, it is mainly an act of prestidigitation. Nothing actually changes; companies simply flip around some numbers.
GameStop, the primordial meme stock, is executing a 4-for-1 stock split today, July 21. The video game retailer will simply divide its stock price by four, as approved by its shareholders, and multiply each stockholder’s share count by four.
Since nothing changes about the fundamental value of the shares, what leads firms to split their stocks?
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