Stock-Split Watch: 2 Consumer Stocks That Look Ready to Split
A common misconception in investing is that a high share price equates to an expensive stock. Valuation, a measure of a stock's cost, is based on factors other than the share price. Mainly, the number of shares attached to a company's market value makes a big difference to the per-share price calculation.
Despite this, it's understandable that some investors might shy away from stocks with triple- or quadruple-digit share prices, especially those without access to fractional shares.
This is one reason companies decide to do stock splits. A stock split has no material impact on the value of an investor's shares. Instead, it allows for more investors to feel comfortable buying the lower-priced shares.
Source Fool.com
