E-commerce giant Amazon (AMZN) has announced a 20-for-1 stock split and a plan to buyback $10 billion of its own shares.
It’s Amazon’s first stock split since the dot-com boom in 1999 and the fourth split in the company’s history.
While largely cosmetic, stock splits make the shares cheaper to buy and more accessible to a larger number of investors, especially individual retail investors.
Were the split to happen today (March 10), the cost of each share would go from $2,785.58 to $139.28, and each existing shareholder would get 19 additional shares for every one that they own.
Amazon is the latest technology company to split its stock. Google parent company Alphabet (GOOGL) announced a 20-for-one split in February. And in mid-2020, Apple (AAPL) split its stock on a four-for-one basis.
Amazon’s stock has been among the worst performing technology securities over the last year and has dropped 16% so far in 2022. Last month, Amazon reported its slowest rate of growth for any quarter since 2001.
Distributions from the stock split will be made to Amazon shareholders at the close of business on June 3, and trading will begin on a split-adjusted basis on June 6, the company said.
This is Amazon’s fourth stock split since its initial public offering (IPO) in 1997, and its first since 1999. Amazon shares also split on a two-for-one basis on June 2, 1998; a three-for-one basis on January 5, 1999; and a two-for-one basis on September 2, 1999.
Amazon shares rose as much as 8% in after hours trading on news of the stock split and share buyback. The stock has risen more than 4,300% since the last split in 1999.