Sandisk Has Surged More Than 3,000% in 12 Months. Is a Stock Split Coming?
Sandisk's meteoric rise has some wondering if a stock split is next, but the bigger story is whether its AI-fueled momentum can keep powering the rally.
Overview
If any stock looks like a textbook candidate for a split right now, it is Sandisk (NASDAQ: SNDK). The ticker has been on a massive tear: Shares have surged more than 3,000% in roughly 12 months, going from around $50 at the time of its spinoff from Western Digital to a 52‑week high above $2,350, and they still trade in the low‑ to mid four figures today. That kind of move puts Sandisk in rare territory and raises a reasonable question: Does management eventually decide to cut the share price into more digestible pieces?
A stock split is simple mechanically. If a company declares a 10‑for‑1 split, every shareholder gets 10 shares for each one they own, and the price per share drops by a factor of 10. If Sandisk were trading at $1,500 before a 10‑for‑1 split, it would open around $150 afterward. The company's market value does not change, nor does your percentage ownership. You just own more, lower‑priced shares instead of fewer, high‑priced ones.
Details
So if it is cosmetic, why do companies bother? In practice, splits can:
Source
Originally published at www.fool.com.