Alphabet Inc Class A (NASDAQ:GOOGL) recently announced that it would be splitting its stock 20-for-1. This is a major change for Google's share price, and it will have some implications for investors.
In this blog post, we will discuss what the Alphabet stock split means for Google investors. We will also provide some educational information about stock splits in general, and explain why Google made this decision.
When is Google's Stock Split?
July 15 is the scheduled date for Google's stock split. This means that after the closing bell, Alphabet stock's price will be divided by 20 and it will trade for significantly less. However, the number of Google shares will increase 20-fold.
For example, let's say you own 100 GOOGL shares at $2000 per share. After the split, you will own 2000 GOOGL shares. But each share will be worth $100, and the total value of your investment will remain the same. In this scenario, the total value of the investment would be around $200,000.
Alphabet (GOOGL) Stock Spit: What Does This Mean for Investors?
As an investor, you might be wondering how the Alphabet stock split will affect you. The main thing to remember is that Google stock split itself is a purely cosmetic change. It doesn't necessarily mean anything for the tech company's fundamentals or its business model.
With that said, there are some potential implications of GOOGL's stock split. First, it could make the stock more accessible to a wider range of investors. When a company's shares are trading at a high price, it can be difficult for smaller investors to get involved.
A Google share was worth around $2000 before the split announcement. But after the split, each share will be worth around $100. This means that even small investors can now afford to buy shares of GOOGL.
The second implication is that the stock split could increase Google's liquidity. When a company's shares are trading at a high price, there is often less trading activity because fewer investors are willing to buy or sell the shares.
When the share price is lower, there is typically more trading activity because more investors are willing and able to trade the shares. This increased liquidity could make it easier for Google shareholders to buy or sell their shares when they want to.
Overall, the Alphabet stock split is a positive development for investors. It will make the stock more accessible and liquid, which could lead to more buying and selling activity in the future. And while the stock split itself doesn't have any bearing on Google's fundamentals, it is still a positive sign for the company's long-term prospects.
If you're thinking about investing in Google, or if you're already an investor, GOOGL's stock split is something to keep on your radar. It could have some implications for how you trade the shares in the future. But overall, it is a positive development for Google investors.
Should You Invest Before the Google Stock Split?
If you're considering investing in Google stock, you might be wondering if you should buy the shares before or after the stock split. There is no right or wrong answer to this question. It ultimately comes down to your personal investment strategy and goals.
If you're looking for long-term growth, then it might make sense to invest before the Alphabet stock split. This way, you can get more shares for your money and benefit from GOOGL's future success. You can also get into the investment before the inflows of new investors start driving up the price.
On the other hand, if you're looking for short-term gains, then it might make sense to wait until after the Google stock split. This way, you can buy more Google shares at a lower price and sell them when they increase in value. By having more shares, you can have the option to trade with less risk. For example, a $100 trade is less risky than a $2000 trade.
This is because you can afford to lose more money on a $100 trade and still make a profit. With $2000, even a 10% drop can result in a loss of $200 while a 10% drop with a $100 investment is only a $20 loss.
Alphabet Stock Split: Is It A Buy?
You probably found this article through a Google search. If not, you might be reading this on an Android phone, or perhaps you are a user of Google Maps, Gmail, Chrome, or any of the company’s other products. Google is hard to avoid. And that’s a good thing for investors.
The tech company has been on a tear since its inception with a few dips along the way. Google’s history is a great example of this company’s success. It is currently going through another dip alongside its upcoming stock split. This means Google’s stock is more affordable now than it has been in a while.
If you are considering Google as a potential investment, this might be a good time to buy it on a correction as the share price becomes affordable. However, your own personal Google stock split analysis should go deeper than that. Make sure to value the company based on its current business model, recent financials, and future prospects.
The Google Stock Split: The Bottom Line
The Google stock split is a positive development for investors. It will make the stock more accessible and liquid, which could lead to more buying and selling activity in the future. And while the stock split itself doesn't have any bearing on Google's fundamentals, it is still a positive sign for the company's long-term prospects.
If you're thinking about investing in Alphabet, or if you're already an investor, the stock split is something to keep on your watchlist. If you are not keen on investing lump sums of money all at once, this GOOGL stock split will allow you to buy Google shares at a lower price.
Remember that a stock split does not change the underlying fundamentals of Alphabet's long-term prospects. Google remains a strong company with an exciting future. The Google stock split is just one more reason to consider investing in the company. DYOR (Do Your Own Research) before making any investment decisions.