At first glance, Nvidia (NASDAQ: NVDA) shares may look a lot more reasonably priced to you these days. Following the recent stock split, they now trade for about $135. That's compared to more than $1,200 prior to the split.

When a company splits its stock, it issues more shares to current holders, which lowers the price of that particular stock. This opens up the investment opportunity to a wider range of potential buyers.

Companies generally decide on a stock split after their shares have climbed quite a bit and often to levels that may be too high for certain investors. In some cases, investors want to make a small purchase and might not have access to fractional shares or may prefer buying full shares. In other cases, a level like $1,000 a share represents a psychological barrier, as some investors consider the stock too pricey -- even if its valuation looks just fine.

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Source Fool.com