Nvidia-Style Stock Splits Are Mixed Blessing for S&P 500

Nvidia Inc.’s market-beating advance Friday in response to a stock split may be short-lived, based on recent history. The chipmaker climbed 2.6% after its board approved a 4-for-1 split, proposed for July, as the S&P 500 Index declined 0.1%. Nvidia is the 10th current member of the S&P 500 to announce a split since last year, according to data compiled by Bloomberg. Only four out of the other nine beat the index in the first three months after their declarations -- including Tesla Inc., whose split preceded its S&P 500 selection.

 

Apple (AAPL)’s fifth stock split since 1987

Apple Inc.’s decision to split its shares is one that relatively few U.S. companies make any more. The iPhone maker is set to become only the third stock in the S&P 500 Index to split this year, according to data compiled by Bloomberg. Old Dominion Freight Line Inc. completed one in March, followed by Edwards Lifesciences Inc. in May. More than 30% of S&P 500 stocks have gone without a split since 2000 or longer, as shown in the chart, and another 24% have never had one. Apple declared a 4-for-1 split last month that is payable Aug. 28. It will be the company’s fifth split since 1987.